Price growth decelerated in November after a long streak of monthly gains, according to the latest S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index.
“U.S. home prices edged downward from their all-time high in November,” says 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.”
The data series, covering all nine U.S. census divisions, reported a 5.1% annual gain in November, up from a 4.7% rise in the previous month.
"The November release illustrated how the housing market can vary widely by geography. While Seattle and San Francisco saw large prices decline, six cities, primarily in the Southeast, hit all-time highs," says Nikolas Scoolis, manager, housing economics, for Zonda. "The lack of resale supply in these areas has kept sustained upward pressure on pricing even despite affordability concerns. Looking forward to the first half of 2024, the dearth of supply is expected to persist until there is more rate relief and incentive to sell."
The 10-City Composite showed an increase of 6.2%, up from a 5.7% increase in the previous month, and the 20-City Composite posted a year-over-year increase of 5.4%, up from a 4.9% increase in the previous month. Detroit once again 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, Oregon, fell 0.7% and remained the only city reporting lower prices in November versus a year ago.
“Six cities registered a new all-time high in November (Miami; Tampa, Florida; Atlanta; Charlotte, North Carolina; New York; and Cleveland). Portland remains the lone market in annual decline,” says Luke. “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.”
With 12 out of the 20 major metros reporting month-over-month decreases, the U.S. National Index and 20-City Composite posted 0.2% month-over-month decreases in November, and 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%.
“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,” says CoreLogic chief economist Dr. Selma Hepp. “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.”
