Home prices are falling at a record pace, according to data from S&P Global released Tuesday.
Prices are still up for the year, but the percentage keeps dropping each month. The S&P CoreLogic Case-Shiller Index, which tracks national home prices, reported annual gains at 13% in August, marking a decline from 15.6% in the previous month and the largest plummet in housing costs since the metric was created in 1987.
“As the Federal Reserve moves interest rates higher, mortgage financing becomes more expensive and housing becomes less affordable,” S&P Managing Director Craig Lazzara said in an analysis. “Given the continuing prospects for a challenging macroeconomic environment, home prices may well continue to decelerate.”
The central bank raised the target federal funds rate by 0.75% in both June and July before hiking rates by the same amount in September. Policymakers, who conventionally raise and slash rate targets by 0.25% increments, are combating inflation which has reached four-decade highs.- READ MORE