Home Prices Up!
DECEMBER 31, 2020
Oct. U.S. Home Prices Up 1.4% Month-to-Month
By Kerry Smith
Head analyst Case-Shiller of CoreLogic calls it “surprising strength,” noting that Oct. prices rose 8.4% year-to-year across the U.S. – even higher than Sept.’s surprising 7.0% increase.
Year-over-year: Overall, the nine Census districts covered in the monthly stats reported an 8.4% annual gain in October, up from 7.0% the previous month (September). The 10-City Composite annual increase came in at 7.5%, up from 6.2% the previous month. And the 20-City Composite posted a 7.9% year-over-year gain, up from 6.6% in the previous month.
Month-over-month: The National Index posted a 1.4% month-over-month increase, while the 10-City and 20-City Composites both posted increases of 1.4% and 1.3% respectively, before seasonal adjustment in October. After seasonal adjustment, the National Index posted a month-over-month increase of 1.7%, while the 10-City and 20-City Composites both posted increases of 1.6%.
In October, all 19 cities (excluding Detroit) reported increases before and after seasonal adjustment.
“The surprising strength we noted in last month’s report continued into October’s home price data,” says Craig J. Lazzara, managing director and global head of Index Investment Strategy at S&P Dow Jones Indices. “The National Composite Index gained 8.4% relative to its level a year ago, accelerating from September’s 7.0% increase. The 10- and 20-City Composites (up 7.5% and 7.9%, respectively) also rose more rapidly in October than they had done in September.”
Lazzara says market strength was “once again broadly-based.” Of the 19 cities studied, “all 19 gained more in the 12 months ended in October than they had gained in the 12 months ended in September.”
The current trend for accelerating home prices began in August 2019 but hit a pandemic-caused bump in May and June 2020, resulting in modestly decelerating price gains.
“Since June, our monthly readings have shown accelerating growth in home prices, and October’s results emphatically emphasize that trend,” says Lazzara. “The last time that the National Composite matched this month’s 8.4% growth rate was more than six and a half years ago, in March 2014. Although the full history of the pandemic’s impact on housing prices is yet to be written, the data from the last several months are consistent with the view that COVID has encouraged potential buyers to move from urban apartments to suburban homes. We’ll continue to monitor what the data can tell us about this question.”
The Index included two Florida cities in its roster. In Miami, home prices rose 1.4% month-to-month and 6.8% year-to-year. In Tampa, prices were up 1.4% month-to-month and 8.4% year-to-year.
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