Home prices continue to rise at a modest rate, according to the latest S&P CoreLogic Case-Shiller Index. The U.S. National Home Price NSA Index, which covers all nine U.S. census divisions, saw an 8.4% year-over-year increase in October, up from 7% the previous month.
The 10-City Composite experienced a 7.5% annual gain in October, up from 6.2% the previous month, and the 20-City Composite posted a 7.9% annual gain, up from 6.6% the previous month. Transaction records are now available for September for Michigan’s Wayne County; however, there are still an insufficient number of records for Detroit for October.
In October, Phoenix, Seattle, and San Diego reported the highest year-over-year gains among 19 cities, excluding Detroit. Phoenix, which led all cities for the 17th consecutive month, experienced a 12.7% year-over-year price increase, followed by Seattle and San Diego with 11.7% and 11.6% increases, respectively. In addition, all 19 cities reported higher price increases in the year ending October versus September. Prices were strongest in the West and Southwest regions, but even the comparatively weak Midwest and Northeast (up 7.7% and 7.9%, respectively) performed creditably well, said Craig J. Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices.
“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. Since June, our monthly readings have shown accelerating growth in home prices, and October’s results emphatically emphasize that trend,” said Lazzara. “The last time that the National Composite matched this month’s 8.4% 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. We’ll continue to monitor what the data can tell us about this question.”
Month over month, the National Index experienced a 1.4% gain, while the 10-City and 20-City Composites both saw increases of 1.4% and 1.3%, respectively, before seasonal adjustment in October. After seasonal adjustment, the National Index posted a month-over-month increase of 1.7%, while the 10-City and 20-City Composites both posted increases of 1.6%. In October, all 19 cities, excluding Detroit, reported increases before and after seasonal adjustment.
