Home Prices Rise at 12.5% Rate in 4Q

Home prices increased at an annualized rate of 12.5% nationwide in the fourth quarter, down from a revised rate of 13.4% in the third quarter, according to the Conventional Mortgage Home Price Index released by Freddie Mac.The Mountain states recorded the biggest price increases, with a 19.4% annualized growth rate, Freddie Mac said. The Pacific states experienced the second-highest annualized gains in the fourth quarter, with an 18.2% growth rate, and the South Atlantic states came in third, at 16.8%. "Mortgage rates rose sharply in the fourth quarter, and we are starting to see marked slowing in the rate of home price appreciation," said Frank Nothaft, Freddie Mac's chief economist. ".... We've now seen two consecutive quarters of moderation in home-value growth. We expect the trend of slowing growth in home values to continue, with national average home-value appreciation about one-half of last year's rise." The index was jointly developed by Freddie Mac and Fannie Mae. Freddie Mac's website address is http://www.freddiemac.com.