Appreciation in the housing market in November resurged, charging forward most notably in the South, according to the S&P CoreLogic/Case-Shiller Indices, released today.
Nationally, home prices rose 3.5 percent year-over-year, climbing from 3.2 percent in October, with the highest increases in Phoenix, at 5.9 percent year-over-year, Charlotte, at 5.2 percent and Tampa at 5 percent. Charlotte and Tampa are housing markets to watch this year, according to the National Association of REALTORS®.
On an annual basis, all cities gained ground, with appreciation in Atlanta and Cleveland posting in the 4 percent range, and appreciation in Boston, Denver, Detroit, Miami, Minneapolis, Portland, San Diego, Seattle and Washington, D.C., landing north of 3 percent. Annual appreciation was weakest in Chicago, New York and San Francisco.
Las Vegas, Nev.
Los Angeles, Calif.
New York, N.Y.
San Diego, Calif.
San Francisco, Calif.
Appreciation bottomed in February 2012, but with the November numbers, is now 59 percent higher than the low point, and also 15 percent above the peak prior to the recession, according to Craig Lazzara, S&P Dow Jones spokesperson.
“The U.S. housing market was stable in November,” Lazzara said in a statement. “With the month’s 3.5 percent increase in the national composite index, home prices are currently 59 percent above the trough reached in February 2012, and 15 percent above their pre-financial crisis peak.”
Lazzara cautioned, however, that the effect of the gains in November remains unknown.
“November’s results were broad-based, with gains in every city in our 20-city composite,” Lazzara said. “It is, of course, still too soon to say whether this marks an end to the deceleration or is merely a pause in the longer-term trend.”
Demand is nudging prices up, Frank Nothaft, chief economist for CoreLogic, says, with buyers gobbling inventory and leveraging low mortgage rates. The average 30-year fixed rate recently tumbled to 3.6 percent, according to Freddie Mac.
Moreover, in the South, booming cities experienced an influx of newcomers in 2019—1 million new residents, the highest in the nation, according to Census figures—further increasing prices in the region.
“Homes are in big demand in markets with a fast-growing population,” Nothaft said in a statement. “Add in low mortgage rates, family income growth and a limited inventory of homes for sale, and that translates into home-price growth that surpasses overall inflation on other consumer products.”
With prices on the rise, inventory should stay tight, according to Bill Banfield, chief risk officer at Quicken Loans.
“We now have back-to-back months where the data shows home prices accelerating a bit faster after months of more moderate gains,” Banfield said in a statement. “If we fast-forward ahead of this data, we see interest rates falling again and the same constrained inventory issues. This should keep home prices rising in most areas of the country.”
In December, existing-home inventory shrank 8.5 percent year-over-year, NAR recently reported. However, despite limited options, Americans are optimistic, the organization’s research reveals.
Suzanne De Vita is RISMedia’s senior online editor. Email her your real estate news ideas at email@example.com.