Homebuyers Have Not Yet Thrown in the Towel
US S&P CoreLogic Case-Shiller Index posted an 18.8% increase year over year.
After some signs of slowing home price growth, suggested by the seasonally adjusted deceleration in month-to-month gains, November monthly price growth re-accelerated again.
Re-acceleration in monthly gains, as reflected in the December S&P CoreLogic Case-Shiller Index, is consistent with continued robust demand, despite spiking home prices and higher costs of borrowing.
Furthermore, the Index indicated home buyers have not yet thrown in the towel. This is also reflected in that it remained steady after three months of slowing, and was up 18.8% year over year, about flat from the 18.8% increase the month prior.
The non-seasonally adjusted month-to-month index was also flat at 0.92%, the same as in November.
Buyers might have also rushed in at the end of the year in anticipation of higher rates in the coming year, which are now about 100 basis points above where they were when December closings were signing contracts.
Except for last winter, the December monthly gain was the strongest in the history of the data series. Generally, there is a decline between November and December, which averaged 0.46% between 2006 and 2019.
Index Proves ‘Another Incredible Year’
Additionally, with now a full year of data, the S&P CoreLogic Case-Shiller Index once again proved that 2021 has been an incredible year for the housing market. The average annual growth of 17.1% is the strongest average annual recorded in the series of data. Last year, the national growth rate averaged 6.6%.
Fifteen metro areas had stronger annual home price growth in December compared to November.
Again, while the U.S. S&P CoreLogic Case-Shiller Index averaged 17.1% for the year, the markets, such as Phoenix which has consistently remained the fastest-growing market for 2.5 years, had average gains in 2021 10 percentage points above the national average.
All 20 metro areas had at least double-digit average growth. San Diego and Dallas followed with a 16% average for the year. And as year-over-year gains showed as well, the smallest increases were in Minneapolis, Washington and Cleveland.