Home Price Gains Stalled In October
NEW YORK (TheStreet) -- Home price gains slowed further in October, with several cities actually seeing a decline in values, according to the latest data from Lender Processing Services.
The LPS Home Price Index rose only 0.1% in October from the previous month. Year-over-year, the index is up 8.2% and has gained 8.8% in 2013 so far.
The LPS data is based on the month's closing transactions and is not seasonally adjusted. The index, however, adjusts for foreclosures and short sales that sell at steep discounts to market price. Unlike the Case-Shiller Index, which will be released on Tuesday, it represents only non-distressed transactions.
Home prices are now just about 14% shy of the June 2006 peak according to LPS. Still, while gains in 2013 have been strong, the pace of gains is slowing.Eight of the largest 20 states saw a slight drop in monthly prices, including California and Texas. Even cities which have reached new peaks recently such as Austin and Dallas saw a slight pullback in October. Still, the slowdown in gains is likely welcome for many home buyers who have struggled to find a home in a sellers' market. Home prices are largely expected to post single digit gains in 2014. Higher mortgage rates and stronger home prices are likely to make homes less affordable, but buyers in the market might have an easier time finding a home with more inventories available for sale and less competition from investors and buyers. -- Written by Shanthi Bharatwaj in New York Follow @shavenk
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