The Federal Reserve’s 50 basis-point interest rate cut in September is already making an impact on housing markets across the country. But high mortgage rates and affordability challenges put a damper on home-price growth in August.

That’s according to CoreLogic’s Home Price Index, which showed that prices rose 3.9% during the year ending August 2024. That is the slowest rate of growth since July 2023. Underscoring the market slowdown is the fact that prices declined 1% from July to August.

“While mortgage rates have dropped in recent weeks, August home sales were [held back] by still-high rates in July and August, which lowered affordability,” Selma Hepp, chief economist for CoreLogic, said in a statement. “The combined impact of high prices and high mortgage rates kept a lid on price growth, with annual gains falling to the lowest level in a year and the monthly gain falling well below what is typically observed in August.

“Price gains in August were driven by areas in the Northeast but brought down by softening markets in Texas and Florida.“ 

While mortgage rates are expected to decline further, CoreLogic’s forecast has home prices rising at an even more tepid pace. It expects prices to rise by 2.3% by August 2025.

There was a discrepancy between attached and detached properties, as detached properties appreciated by 4.2% year over year and attached properties fell slightly by 0.2%.

Geographically, all but one state (Hawaii) posted an annual increase, while South Dakota (+10%) and New Jersey (+9.5%) posted the highest gains. Connecticut, Rhode Island, Wisconsin and Illinois all posted year-over-year gains of more than 7%. Texas and Louisiana posted gains of less than 1%.

While Florida as whole isn’t up much, Miami exploded for an 8.9% annual gain, the highest among the U.S. metros analyzed. Chicago (+6.8%), Las Vegas (+6.5%) and San Diego (+5.1%) also posted strong gains, while Phoenix (+2.5%), Denver (+1.3%) and Houston (+1.1%) were more subdued.