Average house prices increased at a 12.5% annual rate from the first quarter of 2004 through the first quarter of 2005, according to the Office of Federal Housing Enterprise Oversight.House price appreciation has been in double digits for the past four quarters and it hit a record annual rate of 13.4% in the third quarter of 2004, before slowing to 11.8 % in the fourth quarter. "The House Price Index shows the rise in house prices continues at an extremely strong pace and raises the potential for declines in some areas later on," said OFHEO chief economist Patrick Lawler. The highest annual price appreciation occurred in Nevada (31.2%), California (25.4%) and Hawaii (24.4%). The lowest annual price appreciation occurred in Texas (3.77%) Indiana (4.09%) and Oklahoma (4.11).

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