U.S. house prices decelerate in September, likely to see moderate rises over rest of 2018

U.S. house prices slowed down in September. The FHFA house price survey estimates indicates that the recent pattern of modest slowdown in the rate of house price appreciation continued through August. The purchase only house price index rose 0.3 percent sequentially. On a year-on-year basis, house price appreciation decelerated modestly since the spring selling season, from a high of 6.8 percent in March to 6.1 percent year-on-year in August.

This slowdown is corroborated by estimates from the S&P/CoreLogic/Case-Shiller composite house price index through July. The August FHFA estimate came widely in line with expectations of 0.3 percent.

Region wise, prices remains stable or rose in all by one of the nine US region covered by the survey. The exception was the Middle Atlantic, which had the smallest price rise, among the regions. On the contrary, the strongest annual rise was in the Mountain region, where prices rose 8.4 percent year-on-year. The deteriorating home affordability and rising mortgage interest payments are seen as headwinds to house price appreciation and to housing activity more widely.

“However, we expect home prices to continue to register moderate increases over the remainder of the year given the combination of strong demand and lean inventories”, stated Barclays in a research report.

At 17:00 GMT the FxWirePro's Hourly Strength Index of US Dollar was bullish at 78.0635. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex