S&P CoreLogic Case-Shiller Index Shows 3.9% Home Price Gain as of December 2024

Overview

The latest release from S&P Dow Jones Indices reveals an intriguing trend in the U.S. housing market. The S&P CoreLogic Case-Shiller Indices have documented a 3.9% annual rise in home prices as of December 2024. This marks a slight uptick from previous readings, reflecting the ongoing dynamics within the real estate sector.

Detailed Insights

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, which encompasses all nine U.S. census divisions, highlighted a notable return of 3.9% for December, an increase from the 3.7% gain seen the prior month. Concurrently, the 10-City Composite Index recorded a greater annual increase of 5.1%, up from 5% previously while the 20-City Composite Index reported a 4.5% rise, compared to the 4.3% increase in November.

In terms of city performance, New York led the charge with an impressive annual gain of 7.2%, followed closely by Chicago and Boston, which experienced increases of 6.6% and 6.3%, respectively. However, not all markets shared this upward trajectory; Tampa witnessed a decline of 1.1%.

Monthly Trends

When examining the month-over-month changes, both the U.S. National and 20-City Composite indices observed a slight drop of 0.1%. The 10-City Composite Index reported a marginal decrease of 0.04%. This reflects on the seasonal adjustments being applied, after which the overall indices saw a 0.5% increase.

Understanding the Market Dynamics

Brian D. Luke, CFA, the Head of Commodities, Real and Digital Assets at S&P Dow Jones Indices, commented on the market's landscape post-COVID-19 pandemic. He noted, “It has been five years since the outbreak took hold of the global economy, leading to unprecedented volatility and a housing market that shifted dramatically due to changing work and living patterns.”

He further elaborated that national home prices have seen an annual rise of 8.8% since 2020. Key regions contributing to this growth encompass Florida, North Carolina, Southern California, and Arizona. Despite the promising annual figures, Luke cautioned that the current rates of appreciation are below the historic peaks observed in 2021, where home prices surged by as much as 18.9%.

Regional Performance

The real estate market's resilience is particularly evident in the Northeast, which has consistently demonstrated above-trend growth, spearheaded by New York for the past eight months. Boston notably marked an all-time high housing price index, a premier achievement for the city.

In contrast, the decline was observed in markets like San Francisco, which faced a significant drop of 4.5% during the latter half of 2024, making it the worst-performing market since 2020. As the region continues to adjust post-pandemic, it now sits at 11.0% lower than its peak in May 2022.

Conclusion

The S&P CoreLogic Case-Shiller Index firmly establishes itself as a pivotal indicator of the evolving landscape of home prices in the U.S. Through these cycles, participation in the real estate market has historically proven beneficial for wealth accumulation, especially for those utilizing mortgages as leverage. As we move into 2025, stakeholders will be keen to observe how these trends develop amidst ongoing economic shifts.

For comprehensive data and further insights, the complete series of the SPCoreLogic Case-Shiller Indices can be accessed here.