S&P CORELOGIC CASE-SHILLER INDEX UPWARD TREND DECELERATES IN NOVEMBER
- 5.1% annual gain in U.S. home prices
- Detroit and San Diego reported the highest year-over-year gains
- Six cities registered a new all-time high in November
- 12 out of 20 major metro markets reported month-over-month price decreases
- Portland remained the only city reporting lower prices
Insights
The reported 5.1% annual gain in the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index indicates a sustained growth in home prices, albeit at a slower pace than earlier in the year. This trend suggests that while the housing market remains robust, it may be showing signs of cooling. The month-over-month price decreases in 12 out of the 20 major metro markets could reflect the impact of higher mortgage rates, which have peaked recently. The data implies a potential shift in housing demand, with affordability challenges possibly starting to dampen buyer enthusiasm.
Furthermore, the regional disparities in the housing market performance, with Detroit and San Diego leading annual gains, contrast with the overall national deceleration. This could signal underlying economic strengths in these areas or possibly a lagged response to broader national trends. The reported narrowest spread of performance since Q1 2021 indicates a convergence in regional market dynamics, which could lead to more uniform national housing policies.
For stakeholders, including homeowners, investors and policymakers, these trends highlight the need for a nuanced understanding of regional market conditions. The data also serves as a leading indicator for the construction industry and related sectors, potentially influencing stock market sectors associated with homebuilding and mortgage financing.
The S&P CoreLogic Case-Shiller Indices serve as a key barometer for the real estate sector and the reported data has implications for various market participants. The year-over-year increase in home prices, despite the month-over-month declines, suggests that the market retains underlying strength. However, the cessation of the nine-month streak of price increases could indicate the beginning of a market correction or stabilization.
Investors in real estate investment trusts (REITs) and housing-related stocks should consider the impact of these trends on future revenue streams. The nuances in regional performance, particularly the strong growth in cities like Detroit and San Diego, may guide investment strategies towards markets with higher growth potential.
The historical comparison of current levels to the 2006 peaks and 2012 troughs provides context for the long-term recovery and growth of the housing market. This historical perspective is crucial for understanding the cyclical nature of real estate and for setting realistic expectations for future performance.
The S&P CoreLogic Case-Shiller Indices data has several implications for the financial markets. The observed cooling trend in home prices could signal a shift in consumer sentiment and spending, which might affect the broader economy. The real estate sector's performance is closely tied to consumer confidence and financial stability and a downturn could have a ripple effect on other sectors.
From a macroeconomic perspective, the interplay between home prices and interest rates is critical. The recent peak in mortgage rates and subsequent decline could influence homebuyer behavior and, by extension, home prices in the coming months. Financial analysts should monitor these indicators to assess the potential impact on banking and lending institutions, as well as the overall economic outlook.
The data also serves as a valuable input for forecasting future inflation trends, given the weight of housing costs in the consumer price index (CPI). A deceleration in home price growth could contribute to a moderation in inflationary pressures, which would be of particular interest to bond market investors and central bank policymakers.
YEAR-OVER-YEAR
The S&P CoreLogic Case-Shiller
MONTH-OVER-MONTH
For the first time since January 2023, the
After seasonal adjustment, the
ANALYSIS
"
"November's year-over-year gain saw the largest growth in
"Six cities registered a new all-time high in November (
"The tight disparity speaks to a rising tide across the country, with less evidence of micro-markets bucking the trend. The days of markets in the South rising double digits with markets in the Midwest remaining flat are over. The house price decline came at a time where mortgage rates peaked, with the average Freddie Mac 30-year fixed rate mortgage nearing
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 % | 312.15 | 132.9 % | 69.1 % | |
20-City | 206.52 | Jul-06 | 134.07 | Mar-12 | -35.1 % | 318.24 | 137.4 % | 54.1 % | |
10-City | 226.29 | Jun-06 | 146.45 | Mar-12 | -35.3 % | 333.31 | 127.6 % | 47.3 % |
Table 2 below summarizes the results for November 2023. The S&P CoreLogic Case-Shiller Indices could be revised for the prior 24 months, based on the receipt of additional source data.
November 2023 | November/October | October/September | 1-Year | |
Metropolitan Area | Level | Change (%) | Change (%) | Change (%) |
241.91 | 0.0 % | 0.2 % | 5.9 % | |
322.73 | -0.2 % | 0.3 % | 7.1 % | |
271.05 | 0.2 % | 0.3 % | 7.0 % | |
197.67 | -0.4 % | 0.3 % | 7.0 % | |
184.16 | 0.3 % | 0.2 % | 7.4 % | |
292.41 | -0.6 % | -0.3 % | 1.7 % | |
311.96 | -0.9 % | -0.6 % | 1.5 % | |
181.87 | -0.4 % | 0.4 % | 8.2 % | |
284.64 | 0.2 % | 0.3 % | 2.1 % | |
420.57 | 0.1 % | 0.4 % | 7.2 % | |
428.20 | 0.3 % | 0.6 % | 7.2 % | |
234.35 | -0.8 % | -0.3 % | 2.7 % | |
294.23 | 0.3 % | 0.4 % | 7.4 % | |
324.91 | -0.3 % | 0.6 % | 2.5 % | |
319.06 | -1.0 % | -0.9 % | -0.7 % | |
416.36 | -0.5 % | -0.1 % | 8.0 % | |
343.59 | -1.3 % | -0.6 % | 2.0 % | |
363.85 | -1.4 % | -0.5 % | 1.6 % | |
383.22 | 0.1 % | 0.0 % | 3.4 % | |
312.50 | -0.3 % | -0.3 % | 4.7 % | |
Composite-10 | 333.31 | -0.1 % | 0.2 % | 6.2 % |
Composite-20 | 318.24 | -0.2 % | 0.1 % | 5.4 % |
312.15 | -0.2 % | 0.1 % | 5.1 % | |
Sources: S&P Dow Jones Indices and CoreLogic | ||||
Data through November 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.
November/October Change (%) | October/September Change (%) | |||
Metropolitan Area | NSA | SA | NSA | SA |
0.0 % | 0.4 % | 0.2 % | 0.6 % | |
-0.2 % | 0.1 % | 0.3 % | 1.0 % | |
0.2 % | 0.7 % | 0.3 % | 0.7 % | |
-0.4 % | 0.4 % | 0.3 % | 0.7 % | |
0.3 % | 0.9 % | 0.2 % | 0.7 % | |
-0.6 % | 0.1 % | -0.3 % | 0.3 % | |
-0.9 % | -0.5 % | -0.6 % | 0.4 % | |
-0.4 % | 0.2 % | 0.4 % | 1.2 % | |
0.2 % | 1.0 % | 0.3 % | 1.0 % | |
0.1 % | 0.5 % | 0.4 % | 0.7 % | |
0.3 % | 0.7 % | 0.6 % | 0.9 % | |
-0.8 % | 0.0 % | -0.3 % | 0.1 % | |
0.3 % | 0.2 % | 0.4 % | 0.3 % | |
-0.3 % | 0.6 % | 0.6 % | 1.1 % | |
-1.0 % | -0.2 % | -0.9 % | -0.1 % | |
-0.5 % | 0.2 % | -0.1 % | 0.6 % | |
-1.3 % | -0.8 % | -0.6 % | 0.6 % | |
-1.4 % | -0.8 % | -0.5 % | 0.5 % | |
0.1 % | 0.5 % | 0.0 % | 0.4 % | |
-0.3 % | 0.0 % | -0.3 % | 0.3 % | |
Composite-10 | -0.1 % | 0.2 % | 0.2 % | 0.6 % |
Composite-20 | -0.2 % | 0.1 % | 0.1 % | 0.6 % |
-0.2 % | 0.2 % | 0.1 % | 0.6 % | |
Sources: S&P Dow Jones Indices and CoreLogic | ||||
Data through November 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 was the annual gain in U.S. home prices in November 2023?
Which cities reported the highest year-over-year gains?
Which city remained the only one reporting lower prices?
How many metro markets reported month-over-month price decreases?