U.S. home prices increased 0.5% on an adjusted basis in December compared with November and were up 3.9% compared with December 2023, according to the S&P CoreLogic Case-Shiller Indices.
However, when looking at the results on an unadjusted basis, U.S. home prices were down 0.1% compared with the previous month, signaling that home price growth has flattened if not started to decrease on a national scale.
After seasonal adjustment, the index’s 20-city and 10-city composite each posted a month-over-month increase of 0.5%.
But without seasonal adjustment, the 20-city composite saw a 0.1% drop and the 10-city composite saw a 0.04% drop.
Year-over-year, the 10-city composite saw an annual increase of 5.1%, up from a 5% annual increase in November. The 20-city composite posted a year-over-year increase of 4.5%, up from a 4.3% increase in the previous month.
New York again reported the highest annual gain among the 20 cities with a 7.2% increase in December, followed by Chicago and Boston with annual increases of 6.6% and 6.3%, respectively. Tampa posted the lowest return, falling 1.1%.
“It has been five years since the Covid-19 outbreak took hold of the global economy, sparking unprecedented volatility, massive fiscal and monetary stimulus, and a housing market that responded to national migratory changes in how we work and where we live,” says Brian D. Luke, CFA, head of commodities, real and digital assets at S&P Dow Jones Indices, in a statement. “National home prices have risen by 8.8 percent annually since 2020, led by markets in Florida, North Carolina, Southern California, and Arizona. While our National Index continues to trend above inflation, we are a few years removed from peak home price appreciation of 18.9 percent observed in 2021 and are seeing below-trend growth over the history of the index.”
“Home prices stalled during the second half of the year with markets in the West dropping the fastest,” Luke says. “San Francisco, the worst performing market since 2020, dropped 4.5 percent during the last six months of the year, followed by Seattle with a 3.0 percent decline.”
“San Francisco is now 11.0 percent lower than its post- pandemic peak reached in May 2022,” Luke adds. “Previous strongholds like San Diego and Tampa experienced declines of 2.9 percent and 2.7 percent, respectively, during the second half of the year. After accounting for seasonal adjustments, our National Index pushed forward to achieve a 19th consecutive all-time high. The longest such streak occurred for over 12-years, notching 153 consecutive all-time highs from July 1993 to March 2006.”
“The Northeast continues to lead all regions with above-trend growth, led by New York for the eighth consecutive time,” he says. “Boston reached an all-time high, the only market to do so for the period ended December 2024.”
“Pressure on home prices remains muted as many potential buyers and sellers decided to step away from home buying and selling activity going into the winter months,” says Selma Hepp, chief economist for CoreLogic, in a separate statement. “And while anticipation going into the spring home-buying season is building, there are no clear signs yet that buyers will rush in the same way they did during the last couple of years, particularly given the growing concerns around continued inflation and large-scale layoffs in some regions. In addition, while new listings are trickling back in and more homes are available for-sale, homebuyers remain reluctant, which suggests that home price growth is likely to continue slowing in first half of the year.”
Photo: Ian MacDonald