The Federal Housing Finance Agency (FHFA) released its monthly house price index for the U.S. on Wednesday. The U.S. house price index rose 0.8% on a seasonally adjusted basis in September, exceeding expectations for a 0.5% increase, after a 0.3% gain in August.

On a quarterly basis, U.S. house prices climbed 1.3% in the third quarter.

"The long-anticipated slowdown in home price appreciation did not occur in the third quarter. The factors that have contributed to extraordinary price growth over the last few years-low interest rates, tight inventories, strong buyer confidence, and improving income growth-continued to drive prices upward in much of the country. However, as prices continue to rise, reduced affordability will be a stronger market headwind," FHFA Principal Economist Andrew Leventis said.