Report: Home Prices Decelerate but Show YoY Gain


Data released Jan. 30 showed 12 out of the 20 major metro markets reported month-over-month home price decreases. The S&P CoreLogic Case-Shiller Index, covering all nine U.S. census divisions, reported a 4.8% annual change for the month, up from a 4% change in September. 

As for year-over-year, the Index reported a 5.1% annual gain in November, up from a 4.7% rise in the previous month. The 10-City Composite showed an increase of 6.2%, up from a 5.7% increase in the previous month. The 20-City Composite posted a year-over-year increase of 5.4%, up from a 4.9% increase in the previous month. Once again, Detroit reported the highest year-over-year gain among the 20 cities with an 8.2% increase in November, followed again by San Diego with an 8% increase. For the third month in a row, Portland fell 0.7% and remained the only city reporting lower prices in November versus a year ago.

For the first time since January 2023, the U.S. National Index and 20-City Composite posted 0.2% month-over-month decreases in November, while the 10-City Composite posted a 0.1% decrease. After seasonal adjustment, the U.S. National Index and the 10-City Composite posted month-over-month increases of 0.2%, while the 20-City Composite posted a month-over-month increase of 0.1%.

“U.S. home prices edged downward from their all-time high in November,” said Brian D. Luke, head of commodities, real & digital assets at S&P DJI. “The streak of nine monthly gains ended in November, setting the index back to levels last seen over the summer months. Seattle and San Francisco reported the largest monthly declines, falling 1.4% and 1.3%, respectively.

“November’s year-over-year gain saw the largest growth in U.S. home prices in 2023, with our National Composite rising 5.1% and the 10-city index rising 6.2%. Detroit held its position as the best performing market for the third month in a row, accelerating to an 8.2% gain. San Diego notched an 8% annual gain, retaining its second spot in the nation. Barring a late surge from another market, those cities will vie for the ‘housing market of the year’ as the best performing city in our composite.

“Six cities registered a new all-time high in November (Miami, Tampa, Atlanta, Charlotte, New York and Cleveland). Portland remains the lone market in annual decline. The Northeast and Midwest recorded the largest gains with returns of 6.4% and 6.3%, respectively. Other regions are not far behind with the slowest gains in the West of 3%. This month’s report revealed the narrowest spread of performance across the nation since the first quarter of 2021.

“The tight disparity speaks to a rising tide across the country, with less evidence of micro-markets bucking the trend. The days of markets in the South rising double digits with markets in the Midwest remaining flat are over. The house price decline came at a time where mortgage rates peaked, with the average Freddie Mac 30-year fixed-rate mortgage nearing 8%, according to Federal Reserve data. The rate has since fallen over 1%, which could support further annual gains in home prices.”

Realtor.com® Chief Economist Danielle Hale commented that the numbers showed that home prices held onto considerable momentum late in the year, with mortgage rates having an impact.

“This month’s index data tracks September, October and November, a period through which mortgage rates climbed sharply from 7.1% in September to 7.8% by the end of October, before falling back to 7.2% by the end of November. While the number of homes for sale dwindled seasonally, realtor.com® data show that there were more homes on the market and more newly listed homes compared to the prior year, the first such gains in five and 18 months, respectively. Demand steadied and the bump up in listings helped existing-home sales sap a five-month streak of declines. While many potential shoppers had bowed out of the market as rates rose, those who remained acted quickly in case the reprieve in mortgage rates would prove short-lived.

“Looking ahead, mortgage rates have steadied in recent weeks. While this has not yet translated into a jump in closings, pending home sales and new home sales—both of which are based on contract signings, an early stage in the buying process—both surged in December, offering a positive signal for home sales in the next few months. Whether prices hold onto recent momentum remains to be seen. Although year-over-year gains picked up, this was largely due to weaker data one year ago. Month to month, seasonally adjusted price growth slowed from 0.6% to 0.1% or 0.2% across the national, 10- and 20-city composite indices. Only four markets—Charlotte, Cleveland, Las Vegas and Tampa—maintained or accelerated monthly price growth in November.”

“The CoreLogic S&P Case-Shiller Index continued to press higher with home prices increasing by 5.1% year-over-year in November. Surging mortgage rates in late 2023 started to impact prices in November which declined from the month before, down 0.2%—in contrast to a slight increase seen prior to the pandemic at this time of the year. That suggests pivoting of annual gains over the next few months. Still, home price gains remained resilient in many affordable markets (Detroit) as well as areas with warmer weather and outdoor amenities (Miami and Tampa)—something households seek in winter months. More recent decline in mortgage rates along with continued imbalance between pent-up demand and lacking supply suggest home prices will continue to rise in 2024,” said CoreLogic Chief Economist Dr. Selma Hepp.





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