NEW YORK (TheStreet) -- Home prices barely moved in September, as demand for homes slowed on the back of higher interest rates.According to LPS Home Price Index, home prices rose a mere 0.2% from the previous month. Prices are still up 9% on a year-over-year basis and the index is up 8.2% year-to-date.
Seven of the 20 largest states saw modest price declines, a sign that the recovery may have halted in some regions. Connecticut saw a 0.9% drop in home prices, while home prices in New Hampshire dipped 0.6%. Massachusetts, Pennsylvania, New Jersey and Washington were some of the other states that saw prices retreat slightly.
Nevada continued to see prices rise, posting a monthly gain of 0.8%. Arizona saw prices edge up 0.3%. In California, prices were unchanged, after accelerating at a scorching pace for most of this year. The pause might actually be welcome news, as some analysts have worried that prices have risen too fast in the state. Home prices in San Jose are almost back to their previous peak, according to LPS.
Texas continues to hit new highs, with prices up 7.5% this year. On the metro-level, Las Vegas continues to lead the gains, with prices up 26% year-over-year. Of course, home prices in the city are still more than 40% off its peak.
The LPS index is a repeat sales analysis of home prices based on transactions every month. It adjusts for prices of distressed sales such as short sales and foreclosures, which sell at a discount.
On Tuesday, we will have more housing data with the release of the S&P Case-Shiller Home Price Index for September. The Case-Shiller Index is based on a three-month moving average and does not adjust for distressed transactions. The Census Bureau will also release housing starts data for September, which was originally scheduled for release on Oct.17 but was delayed due to the government shutdown.
-- Written by Shanthi Bharatwaj in New York.