U.S. home prices increased 1.7% on an adjusted basis in October compared with September, as demand increased and supply of available homes continued to tighten, according to the S&P CoreLogic Case-Shiller home price index.
The index’s 10-city and 20-city composites – measuring home price growth in the largest U.S. cities – each posted an increase of 1.6%.
Year-over-year, home prices were up 8.4% compared with October 2019. The 10-city composite annual increase came in at 7.5% while the 20-city composite posted a 7.9% year-over-year gain.
Phoenix, Seattle and San Diego continued to report the highest year-over-year gains among the 19 cities (excluding Detroit, which did not report data due to the pandemic) in October.
Phoenix led the way with a 12.7% year-over-year price increase, followed by Seattle with an 11.7% increase and San Diego with an 11.6% increase.
All 19 cities reported higher price increases in the year ended October versus the year ended September.
On an unadjusted basis, the national Index posted a 1.4% month-over-month increase, while the 10-city and 20-city composites posted increases of 1.4% and 1.3% respectively.
“The surprising strength we noted in last month’s report continued into October’s home price data,” says Craig J. Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices. “The housing market’s strength was once again broadly-based. All 19 cities for which we have October data rose, and all 19 gained more in the 12 months ended in October than they had gained in the 12 months ended in September.
“We’ve noted before that a trend of accelerating increases in the National Composite Index began in August 2019 but was interrupted in May and June, as COVID-related restrictions produced modestly- decelerating price gains,” he adds. “Since June, our monthly readings have shown accelerating growth in home prices, and October’s results emphatically emphasize that trend. The last time that the National Composite matched this month’s 8.4 percent growth rate was more than six and a half years ago, in March 2014.
“Although the full history of the pandemic’s impact on housing prices is yet to be written, the data from the last several months are consistent with the view that COVID has encouraged potential buyers to move from urban apartments to suburban homes,” Lazzara says. “We’ll continue to monitor what the data can tell us about this question.”