The average increases in home prices Seattle year after year have fallen to their lowest level in more than three years, but still remain well above the national average, according to the latest figures released on Tuesday.
The S & P CoreLogic Case-Shiller home price index for 20 cities shows that annual prices for Seattle homes increased 8.4 percent in September, down from 9.6 percent the previous month and well below of the double-digit percentage increases that have been the norm since the end of 2015. It was the third consecutive month that increases in house prices have decreased in Seattle.
Still, Seattle's 8.4 percent increase is well above the national average of 5.1 percent, which fell from 5.5 percent in the previous month. It was the sixth consecutive month in which increases in home prices slowed down across the country.
The weaker price gains reflect a broader slowdown in the housing market in the United States. Existing home sales rose modestly in October, breaking a six-month run of declines. But sales are still 5.1 percent lower than a year ago. Sales of new homes have fallen for four consecutive months.
The falls can be mainly due to higher mortgage rates, which have increased in the last year. The average rate for a 30-year fixed mortgage is now 4.9 percent, compared to 3.9 percent the previous year.
House prices, even with the slowdown, continue to rise faster than revenues. Combined with higher borrowing costs, that has made buying a home less affordable for many Americans.
The largest annual price increases occurred in Las Vegas and San Francisco, where prices rose by 13.5 percent and 9.9 percent, respectively. Seattle's 8.4 percent increase was the third highest of the 20 largest cities.
The smallest increases in house prices were recorded in New York, Washington, DC and Chicago, where they rose 2.6 percent, 2.9 percent and 3 percent.
Across the country, the shortage of homes for sale has affected potential buyers over the past two years, but the inventory of unsold homes has increased in recent months. Ralph McLaughlin, deputy chief economist at CoreLogic, a real estate data firm, said that is balancing supply and demand.
Still, "the years of price growth that exceed revenue growth, as well as the increase in mortgage rates, make the cost of buying a home increasingly expensive," McLaughlin said.