24.4 C
New York
Thursday, June 24, 2021
spot_img

Home Price Gains Remained Strong In October

S&P Dow Jones Indices today released the latest results for the S&P CoreLogic Case-Shiller Indices, the leading measure of U.S. home prices. Data released today for October 2020 show that home prices continue to increase across the U.S. More than 27 years of history are available for these data series, and can be accessed in full by going to https://www.spglobal.com/spdji/.

Please note that transaction records for September 2020 for Wayne County, MI are now available. Due to delays at the local recording office caused by the COVID-19 lockdown, S&P Dow Jones Indices and CoreLogic were previously unable to generate a valid September 2020 update of the Detroit S&P CoreLogic Case-Shiller indices.

However, there are not a sufficient number of records for the month of October for Detroit. Since Wayne is the most populous county in the Detroit metro area, S&P Dow Jones Indices and CoreLogic are unable to generate a valid Detroit index value for the December release. When the sale transactions data fully resume and sufficient data are collected, the Detroit index values for the month(s) with missing updates will be calculated.

YEAR-OVER-YEAR 

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported an 8.4% annual gain in October, up from 7.0% in the previous month. The 10-City Composite annual increase came in at 7.5%, up from 6.2% in the previous month. The 20-City Composite posted a 7.9% year-over-year gain, up from 6.6% in the previous month.

Phoenix, Seattle and San Diego continued to report the highest year-over-year gains among the 19 cities (excluding Detroit) in October. Phoenix led the way with a 12.7% year-over-year price increase, followed by Seattle with an 11.7% increase and San Diego with an 11.6% increase. All 19 cities reported higher price increases in the year ending October 2020 versus the year ending September 2020. 

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.

ANALYSIS

“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. The housing market’s strength was once again broadly-based: all 19 cities for which we have October data rose, and all 19 gained more in the 12 months ended in October than they had gained in the 12 months ended in September.

“We’ve noted before that a trend of accelerating increases in the National Composite Index began in August 2019 but was interrupted in May and June, as COVID-related restrictions produced modestly-decelerating price gains. Since June, our monthly readings have shown accelerating growth in home prices, and October’s results emphatically emphasize that trend. 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.

“Phoenix’s 12.7% increase led all cities for the 17th consecutive month. Seattle (11.7%) and San Diego (11.6%) repeated in second and third place. Prices were strongest in the West and Southwest regions, but even the comparatively weak Midwest and Northeast (up 7.7% and 7.9% respectively) performed creditably well.”

SUPPORTING DATA 

Table 1 below shows the housing boom/bust peaks and troughs for the three composites along with the current levels and percentage changes from the peaks and troughs.

2006 Peak2012 TroughCurrent
  Index  Level  Date  Level  DateFrom Peak
(%)
  LevelFrom Trough
(%)
From Peak
(%)
National184.61Jul-06134.00Feb-12-27.4%229.9371.6%24.5%
20-City206.52Jul-06134.07Mar-12-35.1%235.7775.9%14.2%
10-City226.29Jun-06146.45Mar-12-35.3%248.5869.7%9.9%

Table 2 below summarizes the results for October 2020. The S&P CoreLogic Case-Shiller Indices are revised for the prior 24 months, based on the receipt of additional source data.

October 2020October/SeptemberSeptember/August1-Year
Metropolitan AreaLevelChange (%)Change (%)Change (%)
Atlanta165.241.2%1.0%6.8%
Boston244.761.5%1.6%9.4%
Charlotte180.931.3%1.2%8.6%
Chicago153.881.0%1.3%6.3%
Cleveland139.831.2%1.2%9.5%
Dallas205.501.4%0.9%6.5%
Denver238.850.9%0.6%7.0%
Detroit0.9%
Las Vegas206.780.8%0.8%6.4%
Los Angeles312.491.1%1.3%8.4%
Miami263.201.4%1.1%6.8%
Minneapolis194.811.1%1.0%7.8%
New York215.091.9%1.5%6.0%
Phoenix222.801.7%1.9%12.7%
Portland261.330.7%1.4%8.9%
San Diego292.851.7%1.8%11.6%
San Francisco286.450.9%1.3%7.7%
Seattle283.411.1%1.2%11.7%
Tampa242.671.6%1.3%8.6%
Washington253.471.3%1.0%8.2%
Composite-10248.581.4%1.3%7.5%
Composite-20235.771.3%1.3%7.9%
U.S. National229.931.4%1.2%8.4%
Sources: S&P Dow Jones Indices and CoreLogic
Data through October 2020

Table 3 below shows a summary of the monthly changes using the seasonally adjusted (SA) and non-seasonally adjusted (NSA) data. Since its launch in early 2006, the S&P CoreLogic Case-Shiller Indices have published, and the markets have followed and reported on, the non-seasonally adjusted data set used in the headline indices. For analytical purposes, S&P Dow Jones Indices publishes a seasonally adjusted data set covered in the headline indices, as well as for the 17 of 20 markets with tiered price indices and the five condo markets that are tracked.

October/September Change (%)September/August Change (%)
Metropolitan AreaNSASANSASA
Atlanta1.2%1.4%1.0%1.3%
Boston1.5%1.9%1.6%1.8%
Charlotte1.3%1.5%1.2%1.3%
Chicago1.0%1.6%1.3%1.7%
Cleveland1.2%1.9%1.2%1.1%
Dallas1.4%1.5%0.9%1.1%
Denver0.9%1.4%0.6%1.0%
Detroit0.9%1.2%
Las Vegas0.8%1.1%0.8%0.9%
Los Angeles1.1%1.3%1.3%1.5%
Miami1.4%1.6%1.1%1.1%
Minneapolis1.1%1.5%1.0%1.3%
New York1.9%1.8%1.5%1.4%
Phoenix1.7%1.7%1.9%2.0%
Portland0.7%1.4%1.4%1.6%
San Diego1.7%2.2%1.8%2.0%
San Francisco0.9%1.3%1.3%1.6%
Seattle1.1%2.1%1.2%2.2%
Tampa1.6%1.6%1.3%1.2%
Washington1.3%1.5%1.0%1.5%
Composite-101.4%1.6%1.3%1.4%
Composite-201.3%1.6%1.3%1.4%
U.S. National1.4%1.7%1.2%1.4%
Sources: S&P Dow Jones Indices and CoreLogic
Data through October 2020

For more information about S&P Dow Jones Indices, please visit https://www.spglobal.com/spdji/.

ABOUT S&P DOW JONES INDICES

S&P Dow Jones Indices is the largest global resource for essential index-based concepts, data and research, and home to iconic financial market indicators, such as the S&P 500® and the Dow Jones Industrial Average®. More assets are invested in products based on our indices than products based on indices from any other provider in the world. Since Charles Dow invented the first index in 1884, S&P DJI has been innovating and developing indices across the spectrum of asset classes helping to define the way investors measure and trade the markets.

S&P Dow Jones Indices is a division of S&P Global (NYSE: SPGI), which provides essential intelligence for individuals, companies, and governments to make decisions with confidence. For more information, visit https://www.spglobal.com/spdji/.

S. Jack Heffernan Ph.Dhttps://www.shayneheffernan.com
S. Jack Heffernan Ph.D. Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

Related Articles

Stay Connected

15,334FansLike
43,300FollowersFollow
2,855SubscribersSubscribe
- Advertisement -spot_img

Latest Articles