The year-over-year increase in U.S. home prices was the smallest since 2012, according to CoreLogic's latest nationwide home price report. And December was the ninth consecutive month of cooling home price gains across the country, according to the report.
"Higher mortgage rates slowed home sales and price growth during the second half of 2018," said Frank Nothaft, chief economist for CoreLogic. "Annual price growth peaked in March and averaged 6.4 percent during the first six months of the year.
"In the second half of 2018, growth moderated to 5.2 percent," he said. "For 2019, we are forecasting an average annual price growth of 3.4 percent."
Some U.S. metro markets are seeing higher appreciation rates.
Prices were up more than 11 percent from a year ago in Las Vegas and were 5.6 percent higher in Denver.
Even with the slowdown in nationwide home price gains, CoreLogic says that 40 percent of housing markets around the country were overvalued at the end of the year _ including the Dallas area. The study defines an overvalued housing market as one where home prices are at least 10 percent above sustainable levels.
The median price of single-family homes sold by real estate agents in North Texas was 5 percent higher in 2018 than the year before. That's about half the price growth the area saw in 2016 and 2015.
"The slowdown in the rate of home price appreciation reflects the impact of inventory shortages and growing affordability issues in many markets," said Frank Martell, president and CEO of CoreLogic. "On the positive side, if home-price growth continues to moderate, interest rates remain stable and household incomes rise in 2019, it could help renters and first-time buyers to take the plunge and realize the dream of owning a home."
