U.S. home prices registered a 3.9% annual gain in February, down slightly from January’s 4.1% year-over-year increase, according to S&P CoreLogic Case-Shiller U.S. National Home Price Index data released Tuesday.
The S&P Dow Jones Indices report noted that much of the annual appreciation in the Case-Shiller index was “frontloaded into the first half of the period, while the second half reflected a flatter performance, highlighting the broader cooling trend.”
“Even with mortgage rates remaining in the mid-6% range and affordability challenges lingering, home prices have shown notable resilience,” said Nicholas Godec, head of fixed income tradables and commodities at S&P Dow Jones Indices, in a press release. “Buyer demand has certainly cooled compared to the frenzied pace of prior years, but limited housing supply continues to underpin prices in most markets. Rather than broad declines, we are seeing a slower, more sustainable pace of price growth.”
The Case-Shiller index is a measure of the prices of repeat sales of single-family U.S. homes. It is supplemented by composite indexes that track home-sale prices in the 10 and 20 largest U.S. metropolitan areas.
The 10-city composite index rose 5.2% year over year in February, down from a 5.4% annual increase in January. The 20-city composite increased 4.5% annually in February, down from a 4.7% year-over-year gain the previous month.
Among the top 20 metros, New York City had the highest annual gain in February at 7.7%, followed by Chicago and Cleveland with respective increases of 7% and 6.6%. As in January, Tampa, Fla., was the only top metro area to post an annual loss, with home prices falling 1.5%.
In a separate report released Tuesday, the U.S. Federal Housing Finance Agency revealed that its FHFA House Price Index climbed 3.9% year over year in February. The FHFA index, which is a compilation of publicly available house price indexes, rose 0.1% month over month on a seasonally adjusted basis in February.
Jason Lindwall, president of home move-in service company Move Concierge, said in a statement provided to Scotsman Guide that he thinks the volume of home sales will increase in due time.
“This week’s economic reports highlight the American consumer is shifting from spending to saving,” Lindwall commented. “This is actually good news for housing, as once families fill their coffers a bit more, they will be looking to put that money to work. With home values still remaining strong despite ongoing global trade tensions, real estate will be a relatively safe harbor for more and more Americans.”
