Northeast Cities Propped Up National Home Prices In November

Home price appreciation reversed a downward trend in November thanks to demand in Northeastern cities propping up national numbers.

Price gains inched up by 3.8% YOY in November, increasing from a 3.6% annual rate the month prior, according to the S&P CoreLogic Case-Shiller National Home Price NSA Index

The 10-City Composite increased annually by 4.9%, the same from the previous month. The 20-City Composite posted a year-over-year increase of 4.3%, up from a 4.2% 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 0.4%. 

New York reported the highest annual gain among the 20 cities with a 7.3% jump in November. Chicago and Washington came in second and third with annual increases of 6.2% and 5.9%, respectively. 

Tampa saw the lowest return, falling 0.4%. Appreciation in many Florida metros has been hit hard by a combination of robust homebuilding in the state and tough post-hurricane markets.

Tampa is the only market that saw declines both before and after seasonal adjustment.

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

“With the exception of pockets of above-trend performance, national home prices are trending below historical averages,” says Brian D. Luke, CFA, Head of Commodities, Real & Digital Assets. 

“Markets in New York, Washington, D.C., and Chicago are well above norms, with New York leading the way… However, markets out west and in once red-hot Florida are trending well below average growth. Tampa’s decline is the first annual drop for any market in over a year. Returns for the Tampa market and entire Southern region rank in the bottom quartile of historical annual gains, with data going back to 1988.”

Still, the energy in Northeast markets pushed the National Index up to an 18th straight all-time high after seasonal adjustment.

The Federal Housing Finance Agency’s latest House Price Index, meanwhile, showed prices up 0.3% in November and 4.2% YOY.

“Annual house price gains continued to moderate in November, with sales prices in all nine Census divisions exhibiting slower pace of growth than a year earlier,” said Dr. Anju Vajja, Deputy Director for FHFA’s Division of Research and Statistics.

“The slowdown in price growth is likely due to higher mortgage rates contributing to cooling demand.”