Home Prices Grew 3.9% YOY

Home price appreciation increased at a steady clip in December as demand sizzled in cold-climate cities.

Price gains inched up by 3.9% YOY in December, on par with November’s 3.8% and October’s 3.6%, according to the S&P CoreLogic Case-Shiller National Home Price NSA Index. 

The 10-City Composite increased annually by 5.1%, effectively the same from the previous month. The 20-City Composite posted a year-over-year increase of 4.5%, up from a 4.3% increase in the previous month. 

After seasonal adjustment, the U.S. National, 20-City, and 10-City Composite Indices all posted a month-over-month increase of 0.5%. 

New York again reported the highest annual gain among the 20 cities with a 7.2% jump in November. Chicago and Boston came in second and third with annual increases of 6.6% and 6.3%, respectively. 

Tampa saw the lowest return, sliding a further 1.1%. Appreciation in many Florida metros has been hit hard by a combination of robust homebuilding in the state and tough post-hurricane markets.

While the aggregate numbers point to revived price appreciation, most of the country is still seeing a slowdown.

“While our National Index continues to trend above inflation, we are a few years removed from peak home price appreciation of 18.9% observed in 2021 and are seeing below-trend growth over the history of the index,” said Brian D. Luke, CFA, Head of Commodities, Real & Digital Assets at S&P Dow Jones Indices.

Still, the indices posted their 19th consecutive all-time high.

“Through this recent market cycle, the ability of Americans to grow wealth by participating in the upside of the U.S. housing market, particularly if done through a leveraged position by securing a mortgage, has proven to be historically beneficial,” Luke added.

The Federal Housing Finance Agency’s latest House Price Index, meanwhile, showed prices up 0.4% in December and 4.5% YOY.

“U.S. house prices grew at a slightly higher rate in the fourth quarter after three straight previous quarters of weaker appreciation,” said Dr. Anju Vajja, Deputy Director for FHFA’s Division of Research and Statistics. 

“The price growth accelerated during the quarter as the inventory of homes for sale tightened even further.”