Last week’s economic reports included readings on home price growth from S&P Case-Shiller Home Price Indices, data on new home sales, and the University of Michigan’s Consumer Sentiment Index. Weekly readings on mortgage rates and jobless claims were also published.

Case-Shiller: Home Price Growth Slower, but Prices Aren’t Falling

National home prices rose by a seasonally-adjusted annual pace of 19.80 percent in August, which was incrementally lower than July’s year-over-year home price growth rate. Analysts said that rising mortgage rates caused some buyers to leave the market and eased demand in areas where bidding wars drove home prices beyond market value in some areas.

The S&P Case-Shiller 20-City Home Price Index reported a seasonally-adjusted annual pace of  19.70 percent growth for August home prices in metro areas included in the index. Home price growth was slower than July’s year-over-year reading of 20.00 percent. Phoenix, Arizona held the top position with year-over-year home price growth of 33.30 percent. San Diego, California maintained second place with year-over-year home price growth of 26.20 percent. Tampa, Florida displaced previous holders of third place with its home price growth rate of 25.90 percent.

Craig J. Lazzara, managing director and global head of index investment strategy at  S&P Dow Jones Indices, said: “Every one of our city and composite indices stands at its all-time high, and year-over-year price growth continues to be very strong, although moderating somewhat from last month’s levels.”

The Federal Housing Finance Administration, which oversees Fannie Mae and Freddie Mac, published similar results for home price growth in August. Lynn Fisher, deputy director for research and statistics at FHFA, said, “Annual house price gains remained extremely high in August, but the pace of month-over-month gains continues to decelerate…This suggests we may have seen the peak in annual home price  gains for the time being.”

Recent home price growth was driven by high demand for homes and limited supplies of new and pre-owned homes for sale, but rapidly rising home prices and mortgage rates sidelined some buyers.

Mortgage Rates Rise as Jobless Claims Fall

Freddie Mac reported higher average mortgage rates last week as the rate for 30-year fixed-rate mortgages rose five basis points to 3.14 percent. Rates for 15-year fixed-rate mortgages rose four basis points and averaged 2.37 percent. The average rate for a  5/1 adjustable-rate mortgage rose two basis points to 2.56 percent. Discount points averaged 0.70 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable-rate mortgages.

Initial jobless claims fell to 281,000 first-time claims filed as compared to the prior week’s reading of 291,000 new claims filed. Ongoing jobless claims filed also decreased with 2.24 million continuing claims filed as compared to 2.48 million continuing jobless claims filed during the prior week.

The University of Michigan’s Consumer Sentiment Index for October rose to an index reading of 71.7 as compared to September’s reading of 71.4. Analysts expected a reading of 71.9 for October.

What’s Ahead

This week’s scheduled economic news includes readings on construction spending, the post-meeting statement, and a press conference from the Fed’s Federal Open Market Committee and Fed Chair Jerome Powell. Data on public and private-sector jobs will be released along with the national unemployment rate. Weekly readings on mortgage rates and jobless claims will also be published.