Home prices rose 6.6% year-over-year in November 2023 and 0.3% from the previous month, according to the Federal Housing Finance Agency's (FHFA) seasonally-adjusted, monthly House Price Index (HPI®).
Meanwhile, the S&P CoreLogic Case-Shiller Indices, also released Tuesday, indicate that 12 out of 20 major metro markets reported month-over-month price decreases in November. However, the S&P's seasonally-adjusted U.S. National Index and 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%.
“U.S. house prices continued to appreciate in November, with year-over-year growth slightly above the historical average,” said Dr. Nataliya Polkovnichenko, supervisory economist in FHFA’s Division of Research and Statistics. “All nine census divisions experienced positive price appreciation over the last 12 months, with five census divisions exhibiting deceleration compared to the price appreciation observed last year.”
Detroit continued to report the highest year-over-year gain among the 20 cities in CoreLogic’s index, with an 8.2% increase in November. This was once again followed again by San Diego (+8%). Portland remained the only city reporting lower prices in November from the year before, falling by 0.7%.
“U.S. home prices edged downward from their all-time high in November,” says Brian 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.”
Six cities – Miami, Tampa, Atlanta, Charlotte, New York, and Cleveland – registered new all-time highs in November, while Portland remains the lone market in annual decline. The Northeast and Midwest recorded the largest gains, with returns of 6.4% and 6.3%, respectively. The West experienced the slowest gain at 3%.
According to Luke, this month’s report revealed the narrowest spread of performance across the nation since the first quarter of 2021.
“The tight disparity speaks to a rising tide across the country, with less evidence of micro-markets bucking the trend,” he said. “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 8%, according to Federal Reserve data. The rate has since fallen over 1%, which could support further annual gains in home prices.”
The FHFA’s next HPI report, featuring monthly data through December and the fourth quarter of 2023 is expected to be released on February 27, 2024. The S&P CoreLogic Case-Shiller Indices will also be published on the last Tuesday of the month, at 9 a.m. ET.
