S&P CORELOGIC CASE-SHILLER INDEX ACCELERATES IN OCTOBER
- U.S. home prices accelerated at their fastest annual rate of the year in October, with the National Composite rising by 0.2% and marking nine consecutive monthly gains.
- Detroit and San Diego maintained the top spots with 8.1% and 7.2% annual gains, respectively.
- 8 of 20 cities registered all-time highs in home prices, while Portland remained slightly down compared to last year's gains.
- None.
Insights
The data from the S&P CoreLogic Case-Shiller Indices indicates a sustained increase in U.S. home prices, with particular strength in the Detroit and San Diego markets. This trend suggests a robust housing sector, which can have ripple effects across various industries, from construction to home goods retailers. The consistent appreciation of home values, particularly in the Midwest and Northeast regions, reflects a strong demand for housing in these areas.
However, it's important to consider the potential impact of rising home prices on affordability and the broader economy. Higher home prices can lead to increased wealth for homeowners but may also contribute to a widening gap in housing affordability, potentially affecting first-time homebuyers and lower-income families. The data also hints at regional disparities, with the Southwest and West regions lagging, which could indicate market saturation or shifts in demographic preferences.
The reported 4.8% annual increase in the U.S. National Home Price NSA Index could be a positive indicator for investors in real estate investment trusts (REITs) and construction companies, as it signals healthy demand and pricing power in the real estate market. Additionally, the index's rise to all-time highs may contribute to consumer confidence and spending, as homeowners perceive increased equity in their properties.
On the flip side, investors should be cautious about the potential for interest rate changes by the Federal Reserve. While mortgage rates have eased recently, any future hikes could dampen the housing market's momentum. Moreover, the increase in home prices may not be sustainable in the long term if it outpaces income growth, leading to affordability issues and possible market corrections.
The S&P CoreLogic Case-Shiller Indices provide valuable insights into the economic health of the U.S. housing market. The observed increase in home prices is indicative of a strong economy with robust consumer spending. However, this growth must be contextualized within the broader economic framework. For instance, if the growth in home prices significantly outpaces GDP growth or wage inflation, it could signal an overheating market, leading to concerns over a potential housing bubble.
Additionally, the housing market is a critical component of the economy that influences monetary policy decisions. The Federal Reserve may consider the pace of home price appreciation when determining interest rate policies to ensure economic stability. Therefore, the indices' data can have significant implications for future monetary policy and, consequently, the stock market.
YEAR-OVER-YEAR
The S&P CoreLogic Case-Shiller
The chart on the following page compares year-over-year returns of different housing price ranges (tiers) for
MONTH-OVER-MONTH
Before seasonal adjustment, the
After seasonal adjustment, the
ANALYSIS
"
"
"Each of our 10-city, 20-city and National Index, remain at all-time highs, with 8 of 20 cities registering all-time highs (
"Home prices leaned into the highest mortgage rates recorded in this market cycle and continued to push higher. With mortgage rates easing and the Federal Reserve guiding toward a slightly more accommodative stance, homeowners may be poised to see more appreciation."
Table 1 below shows the housing boom/bust peaks and troughs for the three composites along with the current levels and percentage changes from the peaks and troughs.
2006 Peak | 2012 Trough | Current | |||||||
Index | Level | Date | Level | Date | From Peak | Level | From Trough | From Peak | |
National | 184.61 | Jul-06 | 134.00 | Feb-12 | -27.4 % | 312.95 | 133.5 % | 69.5 % | |
20-City | 206.52 | Jul-06 | 134.07 | Mar-12 | -35.1 % | 319.00 | 137.9 % | 54.5 % | |
10-City | 226.29 | Jun-06 | 146.45 | Mar-12 | -35.3 % | 333.71 | 127.9 % | 47.5 % | |
Table 2 below summarizes the results for October 2023. The S&P CoreLogic Case-Shiller Indices could be revised for the prior 24 months, based on the receipt of additional source data.
October 2023 | October/September | September/August | 1-Year | ||||
Metropolitan Area | Level | Change (%) | Change (%) | Change (%) | |||
242.03 | 0.2 % | 0.1 % | 5.3 % | ||||
323.56 | 0.3 % | 0.5 % | 6.6 % | ||||
270.43 | 0.3 % | 0.5 % | 6.0 % | ||||
198.47 | 0.2 % | 0.3 % | 6.9 % | ||||
183.69 | 0.2 % | 0.3 % | 6.4 % | ||||
294.28 | -0.3 % | -0.1 % | 1.2 % | ||||
314.86 | -0.6 % | -0.3 % | 1.6 % | ||||
182.55 | 0.3 % | 0.7 % | 8.1 % | ||||
284.04 | 0.3 % | 0.6 % | 0.1 % | ||||
419.90 | 0.4 % | 0.2 % | 6.1 % | ||||
427.22 | 0.6 % | 0.6 % | 6.7 % | ||||
236.39 | -0.3 % | -0.4 % | 2.8 % | ||||
293.42 | 0.5 % | 0.6 % | 7.1 % | ||||
326.03 | 0.6 % | 0.5 % | 0.9 % | ||||
322.37 | -0.9 % | -0.4 % | -0.6 % | ||||
418.82 | -0.1 % | 0.0 % | 7.2 % | ||||
347.86 | -0.6 % | 0.1 % | 1.6 % | ||||
368.87 | -0.5 % | -0.5 % | 1.5 % | ||||
382.83 | 0.0 % | 0.5 % | 2.3 % | ||||
313.31 | -0.3 % | 0.1 % | 4.7 % | ||||
Composite-10 | 333.71 | 0.2 % | 0.3 % | 5.7 % | |||
Composite-20 | 319.00 | 0.1 % | 0.2 % | 4.9 % | |||
312.95 | 0.2 % | 0.3 % | 4.8 % | ||||
Sources: S&P Dow Jones Indices and CoreLogic | |||||||
Data through October 2023 | |||||||
Table 3 below shows a summary of the monthly changes using the seasonally adjusted (SA) and non-seasonally adjusted (NSA) data. Since its launch in early 2006, the S&P CoreLogic Case-Shiller Indices have published, and the markets have followed and reported on, the non-seasonally adjusted data set used in the headline indices. For analytical purposes, S&P Dow Jones Indices publishes a seasonally adjusted data set covered in the headline indices, as well as for the 17 of 20 markets with tiered price indices and the five condo markets that are tracked.
September/August Change (%) | |||||||
Metropolitan Area | NSA | SA | NSA | SA | |||
0.2 % | 0.7 % | 0.1 % | 0.6 % | ||||
0.3 % | 1.0 % | 0.5 % | 0.9 % | ||||
0.3 % | 0.7 % | 0.5 % | 0.8 % | ||||
0.2 % | 0.7 % | 0.3 % | 0.6 % | ||||
0.2 % | 0.6 % | 0.3 % | 0.9 % | ||||
-0.3 % | 0.3 % | -0.1 % | 0.7 % | ||||
-0.6 % | 0.4 % | -0.3 % | 0.5 % | ||||
0.3 % | 1.2 % | 0.7 % | 1.3 % | ||||
0.3 % | 0.9 % | 0.6 % | 1.4 % | ||||
0.4 % | 0.7 % | 0.2 % | 0.6 % | ||||
0.6 % | 0.9 % | 0.6 % | 1.0 % | ||||
-0.3 % | 0.2 % | -0.4 % | 0.2 % | ||||
0.5 % | 0.5 % | 0.6 % | 0.8 % | ||||
0.6 % | 1.1 % | 0.5 % | 1.1 % | ||||
-0.9 % | -0.1 % | -0.4 % | 0.1 % | ||||
-0.1 % | 0.5 % | 0.0 % | 0.8 % | ||||
-0.6 % | 0.5 % | 0.1 % | 1.0 % | ||||
-0.5 % | 0.4 % | -0.5 % | 0.8 % | ||||
0.0 % | 0.3 % | 0.5 % | 0.7 % | ||||
-0.3 % | 0.2 % | 0.1 % | 0.8 % | ||||
Composite-10 | 0.2 % | 0.6 % | 0.3 % | 0.7 % | |||
Composite-20 | 0.1 % | 0.6 % | 0.2 % | 0.7 % | |||
0.2 % | 0.6 % | 0.3 % | 0.7 % | ||||
Sources: S&P Dow Jones Indices and CoreLogic | |||||||
Data through October 2023 | |||||||
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The S&P CoreLogic Case-Shiller Indices are published on the last Tuesday of each month at 9:00 am ET. They are constructed to accurately track the price path of typical single-family homes located in each metropolitan area provided. Each index combines matched price pairs for thousands of individual houses from the available universe of arms-length sales data. The S&P CoreLogic Case-Shiller
These indices are generated and published under agreements between S&P Dow Jones Indices and CoreLogic, Inc.
The S&P CoreLogic Case-Shiller Indices are produced by CoreLogic, Inc. In addition to the S&P CoreLogic Case-Shiller Indices, CoreLogic also offers home price index sets covering thousands of zip codes, counties, metro areas, and state markets. The indices, published by S&P Dow Jones Indices, represent just a small subset of the broader data available through CoreLogic.
Case-Shiller® and CoreLogic® are trademarks of CoreLogic Case-Shiller, LLC or its affiliates or subsidiaries ("CoreLogic") and have been licensed for use by S&P Dow Jones Indices. None of the financial products based on indices produced by CoreLogic or its predecessors in interest are sponsored, sold, or promoted by CoreLogic, and neither CoreLogic nor any of its affiliates, subsidiaries, or predecessors in interest makes any representation regarding the advisability of investing in such products.
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SOURCE S&P Dow Jones Indices
FAQ
What are the latest results for the S&P CoreLogic Case-Shiller Indices?
How many metro markets reported month-over-month price increases?
What is the National Composite's change in October?
Which cities registered all-time highs in home prices?
Which city had the highest year-over-year gain in October 2023?
