January’s iteration of the S&P CoreLogic Case-Shiller U.S. National Home Price Index revealed a 6.0% annual gain.
The increase, which was up from 5.6% one month prior, was the fastest annual pickup since 2022.
The 10-City Composite, tracking prices in 10 of the country’s largest markets, saw a 7.4% annual increase in January, up from 7.0% in December. The 20-City Composite picked up steam on a yearly basis as well, logging a 6.6% gain, up from 6.2% one month prior.
Every city tracked in the composite indices saw annual price increases. Southern California flexed its home price muscle within the index returns, with San Diego posting the largest year-to-year increase in home prices among the 20 cities tracked by the composites. San Diego’s 11.2% January jump was followed by Los Angeles at 8.6%.
“We’ve commented on how consistent each market performed during 2023, and that continues to be the case,” said Brian D. Luke, head of commodities, real & digital assets at S&P Down Jones Indices. “While there is a large disparity between leaders such as San Diego versus laggards such as with Portland, the broad market performance is tightly bunched up.
“This is also true of high and low tiers. The average annual gains between high and low tiers across cities tracked by the indices is just 1.1%. Low-price-tiered indices have outperformed high priced indices for 17 months. Homeowners most likely saw healthy gains in the last year, no matter what city you were in, or if it was in an expensive or inexpensive neighborhood. No matter which way you slice it, the index performance closely resembled the broad market.”
Month over month, the national index continued to decline, marking a third straight decrease after nine months of upward trajectory. Price growth in the near term has been weakened by growth in inventory and the high cost of capital.
“On a monthly basis, home prices continue to struggle in the face of elevated borrowing costs,” said Luke. “Seventeen markets dropped over the last month, while Minneapolis has posted a 2.4% decline over the prior three months. Only Southern California and Washington D.C. have stood up the rising wave of interest rates and deliver positive returns to start the year.”
