Single-family home prices growth remained positive to end 2023, but decelerated from levels seen earlier in the year. Prices increased 1.7% on a quarterly basis and 7.1% on a year-over-year basis in the fourth quarter of 2023, according to Fannie Mae’s Home Price Index. The index measures the average, quarterly price change for all single-family properties in the U.S., excluding condos.
On a quarterly basis, home prices rose a seasonally adjusted 1.7 percent in Q4 2023, a deceleration from 2.1 percent growth in the third quarter. On a non-seasonally adjusted basis, home prices increased by 0.4 percent in Q4 2023.
“In the current supply-constrained housing market, any changes to the fundamentals of affordability are going to affect demand, and we saw this in the fourth quarter with interest rates peaking near 8% and helping further slow home price growth,” said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. “Of course, the fourth quarter is also typically the slowest of the year in terms of housing activity and purchase demand, so seasonality should be taken into account, as well. For the year, housing demand held up surprisingly well, in large part due to ongoing demographic support – Millennials continue to drive demand in many areas – and generally strong household finances.”
