The latest S&P / Case-Shiller® Home Price Index® numbers were published this Tuesday.
The new report covers home sales during the period October to December 2023. This means the typical home sale closed in mid November, more than 3 months ago. Please remember that Case-Shiller data is fairly old, even on the day it is released.
We have 3 of the 20 cities showing rising prices for last month, with a lower index for Phoenix for the second time in 10 months. 17 cities declined over the last month with Minneapolis the most affected.
Comparing with the previous month's series we see the following changes:
- Miami +0.3%
- Las Vegas +0.2%
- Los Angeles +0.1%
- Washington -0.0%
- New York -0.0%
- Atlanta -0.1%
- Charlotte -0.1%
- Chicago -0.2%
- Tampa -0.3%
- Denver -0.5%
- Seattle -0.5%
- Phoenix -0.6%
- Detroit -0.7%
- Cleveland -0.7%
- Dallas -0.7%
- San Diego -0.8%
- Boston -0.8%
- San Francisco -0.9%
- Portland -1.0%
- Minneapolis -1.0%
Phoenix has dropped from 11th to 12th place since last month. The national average increase month to month was -0.4%, so Phoenix fell just below that standard.
Comparing year over year, we see the following changes:
- San Diego +8.8%
- Los Angeles +8.3%
- Detroit +8.3%
- Chicago +8.1%
- Charlotte +8.0%
- Miami +7.8%
- New York +7.6%
- Cleveland +7.4%
- Boston +7.2%
- Atlanta +6.3%
- Washington +5.1%
- Las Vegas +4.2%
- Tampa +4.1%
- Phoenix +3.8%
- San Francisco +3.2%
- Seattle +3.0%
- Minneapolis +2.9%
- Denver +2.3%
- Dallas +2.2%
- Portland +0.3%
Phoenix remained in 14th place, and is still in the bottom half on a year over year basis. All 20 of the cities are now showing positive price movement from one year ago with Portland once again doing relatively poorly. Southern California is now showing the highest annual appreciation, closely followed by Detroit and Chicago.
The national average is +3.0% year over year. Phoenix is therefore exceeding that percentage, in contrast to last month.
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I usually feel obliged to make the point that Case-Shiller data inherently has that 3-month lag...so, well, there I said it:)
3 factors to pay attention to right now:
1. We're at the beginning of the year with inventory (Supply) generally increasing relative to Demand, particularly in the higher price ranges.
The takeaway, which is always the takeaway, is pay attention to the specific supply vs. demand trends in the submarket you're working in. The broad brush is often contradicted at the street level where decisions are made. Specialization is where you create value. Always!
2. Interest rates are our boogeyman. And while there is somewhat of a consensus that rates will moderate this year, keep in mind prognosticators historically get it wrong - suggesting we keep fingers and toes crossed for lower mortgage rates ahead and...
Since we can't 'bank' on that (pardon the pun), best to adapt to the cards on the table in facilitating my clients getting from 'where they are to where they want to be'. It can be a mistake to let unreliable prognostication lead to procrastination because...
3. Time is not only of the essence, it's usually the enemy. Modest appreciation continues. That can motivate and should be factored into decision-making.
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