The S&P CoreLogic Case-Shiller National Home Price Index reaccelerated and grew by 6.4% year over year in February, marking the index’s eighth straight month of annual growth.
The increase, which was up from 6.0% one month prior, was the largest yearly rise since November 2022. Home prices nationwide are now largely at or near all-time highs again after some short-term decline last year. Prices are now up by 1.3% compared to the recent high in June 2022.
“Since the previous peak in prices in 2022, this marks the second time home prices have pushed higher in the face of economic uncertainty,” said Brian D. Luke, head of commodities, real & digital assets at S&P Dow Jones Indices. “The first decline followed the start of the Federal Reserve’s hiking cycle. The second decline followed the peak in average mortgage rates last October. Enthusiasm for potential Fed cuts and lower mortgage rates appears to have supported buyer behavior, driving the 10- and 20-city composites to new highs.”
The 10-city composite index, tracking home prices in 10 of the country’s largest metro areas, posted an 8.0% annual increase, up from 7.4% in January, The 20-city composite logged a yearly jump of 7.3%, up from 6.6% the previous month. Both are currently at all-time highs; compared with their peaks in 2006, the 10-city composite is now 58% higher, while the 20-city is 55% higher. The composite indices are benefitting from strong gains in markets like New York and Chicago, which have been boosted by return-to-office policies bringing much of their office-working populations back within metropolitan borders.
Every city tracked in either index reported annual home price gains, the third consecutive month all have done so. Four are currently at all-time peaks: San Diego, Los Angeles, New York and Washington, D.C.
“San Diego has been the best performing market following the trough in home prices observed in early 2023,” noted Luke. “With Los Angeles rising for 13 consecutive months to record another new high, Southern California has outperformed its surrounding neighbors. San Francisco has dropped 12% since its peak, while Phoenix and Las Vegas have dropped 6% and 4.5%, respectively.”
