Home Prices Rose 0.2% in September

Home prices picked up speed in September, according to the closely-watched S&P/Case-Shiller index.

The 20-city composite rose 5.5 percent year over year in September, compared with consensus estimates for a 5.2 percent rise. Prices rose 5.5% for the year, up from a 5.1% yearly gain in August. Mr. Blitzer said the median home price remains affordable to a typical family, when factoring in very low mortgage rates, although affordability has worsened recently. New home sales are expected to climb to a rate of 499,000.

“We expect solid employment growth and modest wage increases to continue to support the housing market”, said analysts at Barclays.

San Francisco, Denver and Portland reported the highest year-over-year gains among the major markets, each with double-digit percentage increases in their home prices.

However, after adjusting for the CPI core rate of inflation, the index rose 3% from September 2014 to September 2015. The S&P/Case-Shiller index is based on a three-month average, which means the September figure also was influenced by transactions in August and July. Annual price gains accelerated in August and September, breaking out of a four-month holding pattern. After seasonal adjustment, the National Index posted a gain of 0.8%, while the 10-City and 20-City Composites both increased 0.6% month-over-month.

Dallas-area home prices are at an all time high in the Case-Shiller report. Economists said that particularly if mortgage rates that could make it even more hard for people to afford homes in those areas and slow sales.