‘Unstoppable’ home prices hit new high
Octobers S&P/Case-Shiller Home Price Index shows that home prices are continuing to ascend to all-time highs with no signs of slowing down.
October 2017’s national index comes in at 195.05, a 6.1 percent year-over-year increase from August 2016 and a seasonally adjusted 0.1 percent month-over-month increase.
“Home price increases appear to be unstoppable,” said S&P Dow Jones Indices Managing Director and Chairman of the Index Committee David M. Blitzer in a statement. “The ongoing rise in home prices poses questions of why prices are climbing and whether they will continue to outpace most of the economy.”
Coupled with a strong economy, mortgage rates that remain historically low are creating market conditions that support home prices reaching all-time highs. But as the Fed bumps up short-term interest rates, demand is expected to weaken and eventually soften the cost of housing.
10-city and 20-city composite
The 10-City and 20-City composite posted 5.3 percent and 5.9 percent year-over-year gains, respectively, and the cities of Seattle, Washington; San Diego, California; and Las Vegas, Nevada led the way. Seattle reported a 13.2 percent year-over-year price increase, followed by Las Vegas with an 8.6 percent increase.
San Diego shored up the end of the pack with a 7.8 percent increase.
The 10-City and 20-City composites reported 0.5 percent and 0.4 percent seasonally adjusted month-over-month increases, and only San Francisco reported a negative (-0.1 percent) monthly price change.
About S&P/Case-Shiller U.S. National Home Price Index
The S&P/Case-Shiller U.S. National Home Price Index is a composite of single-family home price indices that is calculated every month; the indices for the nine U.S. Census divisions are calculated using estimates of the aggregate value of single-family housing stock for the time period in question.
The nine divisions are:
- New England
- Middle Atlantic
- East North Central
- West North Central
- South Atlantic
- East South Central
- West South Central
CoreLogic serves as the calculation agent for the S&P/Case-Shiller U.S. National Home Price Index.