Home Price Gains Decelerate Nationwide
The S&P CoreLogic Case-Shiller Index shows home price gains were the weakest in Western metros.
- Home prices had a 5.8% annual gain in December 2022, down from 7.6% in the previous month.
- In December, all 20 cities reported declines both before and after seasonal adjustments.
- Miami, Tampa, and Atlanta metros led the way with the highest year-over-year home price gains, though not as impressive as the previous month.
- Home prices continue to fall in San Francisco, Seattle, and Portland.
Data released from the S&P Dow Jones Indices (S&P DJI) on Tuesday show that home-price gains continued to drop across the United States in December 2022, with declining prices reported in the San Francisco and Seattle markets.
The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, reported a 5.8% annual gain in December, down from 7.6% in the previous month. The 10-City Composite annual increase came in at 4.4%, down from 6.3% in the previous month. Meanwhile, the 20-City Composite posted a 4.6% year-over-year gain, down from 6.8% in the previous month.
“The cooling in home prices that began in June 2022 continued through year end, as December marked the sixth consecutive month of declines for our National Composite Index,” says Craig J. Lazzara, managing director at S&P DJI. “For 2022 as a whole, the National Composite rose by 5.8%, the 15th best performance in our 35-year history, although obviously well below 2021’s record-setting 18.9% gain.”
The Miami, Tampa, and Atlanta metros led the way with the highest year-over-year home price gains among the 20 cities in December. Miami was first with a 15.9% year-over-year price increase, followed by Tampa with a 13.9% increase, and Atlanta with a 10.4% increase. Yet, all 20 cities reported lower prices in December compared to November 2022.
“Unsurprisingly, the Southeast (+12.5%) and South (+11.6%) were the strongest regions, and the West (+1.2%) continuing as the weakest,” Lazzara added.
The U.S. National Index posted a 0.8% month-over-month decrease in home prices last December, before seasonal adjustment. The 10-City and 20-City Composites posted decreases of 0.8% and 0.9%, respectively.
After seasonal adjustment, the U.S. National Index posted a month-over-month decrease of 0.3%, and the 10-City and 20-City Composites posted decreases of 0.4% and 0.5%, respectively.
For the month of December, all 20 cities reported declines both before and after seasonal adjustments.
“We noted last month that home prices in San Francisco had fallen on a year-over-year basis,” Lazzara said. “San Francisco’s decline worsened in December (-4.2% year-over-year); its west coast neighbors Seattle (-1.8%) and Portland (+1.1%) once again form the bottom of the league table.”
Ultimately, Lazzara said, home prices will continue to weaken. Stable or higher interest rates means mortgage financing will remain a headwind for home prices, while economic weakness and the possibility of a recession may also constrain potential buyers.