Single-family home prices increased 5.9 percent from Q3 2023 to Q3 2024, a deceleration compared to the previous quarter’s downwardly revised annual growth rate of 6.4 percent, according to the latest reading of the Fannie Mae Home Price Index (HPI.

On a quarterly basis, home prices rose a seasonally adjusted 1.3 percent in Q3 2024, down from the revised 1.4 percent growth in Q2 2024. On a non-seasonally adjusted basis, home prices increased by 0.9 percent in Q3 2024.

“Despite decelerating slightly, home price growth remained robust in the third quarter, as the supply of homes for sale, particularly on the existing side, remained weak relative to historical levels,” Fannie Mae Senior Vice President and Chief Economist Mark Palim said in a release. “Even though mortgage rates fell precipitously in the third quarter, and we saw some improvements to the months’ supply of homes for sale, home purchase activity barely budged, at least on a national basis, which we view as evidence that the market remains significantly constrained by both the ‘lock-in effect’ and affordability generally, but especially elevated home prices.

“In fact, consumers have told us as much: in September, high home prices supplanted high mortgage rates as the top reason for our survey respondents’ overwhelming pessimism toward homebuying conditions,” Palim added. “Overall, the strength of this latest home price reading confirms the ongoing challenges with tight supply; however, the index’s continued deceleration shows that we’re slowly moving toward a better balance between supply and demand.”