The numbers: Home prices in the 20 biggest U.S. metros rose for the 11th month in a row and hit a record high amid a persistent shortage of resale homes for sale.
The S&P CoreLogic Case-Shiller 20-city house price index rose 0.2% in December compared to the previous month.
Home prices in the 20 major U.S. metro markets were up 6.1% in the last 12 months ending in December.
A broader measure of home prices, the national index, rose 0.2% in December and was also up 5.5% over the past year. All numbers are seasonally adjusted.
The 20-city and the national index are at an all-time high.
Key details: San Diego posted the biggest year-over-year home-price gains in December. Prices were up 8.8%.
All 20 major markets reported yearly gains for the first time in 2023, S&P said.
Home prices rose the slowest in Portland, increasing by 0.3%.
| Cities | Change from last year |
| Atlanta | 6.3% |
| Boston | 7.2% |
| Charlotte | 8% |
| Chicago | 8.1% |
| Cleveland | 7.4% |
| Dallas | 2.1% |
| Denver | 2.3% |
| Detroit | 8.3% |
| Las Vegas | 4.2% |
| Los Angeles | 8.3% |
| Miami | 7.8% |
| Minneapolis | 2.9% |
| New York | 7.6% |
| Phoenix | 3.8% |
| Portland | 0.3% |
| San Diego | 8.8% |
| San Francisco | 3.2% |
| Seattle | 3% |
| Tampa | 4.1% |
| Washington | 5.1% |
| Composite-20 | 6.1% |
A separate report from the Federal Housing Finance Agency also showed home prices rose 0.1% in December from the last month, and were up 6.6% in the past year.
The FHA also noted that the housing market has experienced annual home price growth every quarter since the start of 2012.
The median price of a resale home was $382,600 in December 2023, and a newly built home was $413,200.
Big picture: Even though rates went to 8% in 2023 and dried up demand, that did not push down home prices significantly, per the Case-Shiller index. However early analysis of the data indicates that some markets are seeing home price declines.
But with the 30-year dropping below 7% in December, home prices may see a boost as demand picks up. And with a persistent and severe shortage of homes for sale, home prices could be pressured upwards again.
What S&P said: “Looking back at the year, 2023 appears to have exceeded average annual home price gains over the past 35 years,” Brian D. Luke, head of commodities, real & digital assets at S&P Dow Jones Indices, said in a statement.
“While we are not experiencing the double-digit gains seen in the previous two years, above-trend growth should be well received considering the rising costs of financing home mortgages,” he added.
And the company said it was able to see the early impact of higher rates on home prices. “Increased financing costs appeared to precipitate home price declines in the fourth quarter, as 15 markets saw lower values compared to September,” Luke noted.
The top three markets on that list were Portland, which saw home prices fall 2.8% in the fourth quarter of 2023 as compared to the prior quarter, San Francisco, with a drop of 2.5%, and Seattle, where home prices dropped 2.4%.
What are they saying? “The bigger picture is that house prices had a stellar 2023, finishing the year 4.7% higher compared to the consensus forecast at the beginning of the year that they would fall by 5.6%,” Thomas Ryan, property economist at Capital Economics, wrote in a note.
Looking ahead: “We expect house price growth to stay robust,” Ryan said, due to the ongoing lock-in effect and as demand recovers. “As a result, we’re forecasting a 5% increase in house prices in 2024, far more optimistic than the 1.8% consensus,” he added.
“Buyers are anxiously waiting to jump in the market as soon as mortgage rates fall,” Selma Hepp, chief economist at CoreLogic, said in a statement. “That means that 2024 will show another year of home price highs.”
