CoreLogic: US Home Prices Increased 5.5% Year-over-year in February

by Calculated Risk on 4/02/2024 08:00:00 AM

Notes: This CoreLogic House Price Index report is for February. The recent Case-Shiller index release was for January. The CoreLogic HPI is a three-month weighted average and is not seasonally adjusted (NSA).

From CoreLogic: CoreLogic: US Annual Home Price Growth Slows but Still Up by Over 5% in February

U.S. single-family home prices rose by 5.5% year over year in February and are expected to taper to 3.1% growth by February 2025.

• Four of the top five states with the highest annual home price growth are in the Northeast: New Jersey, Rhode Island, Maine and Connecticut

• The five states where home prices remain furthest from the summer 2022 peak are Idaho, Washington, Utah, Vermont and Montana

• The Miami and San Diego metro areas continued to lead the country for annual growth in February, both at about 10%

U.S. annual home price growth remained mostly consistent with numbers seen since last fall in February but finally slowed as the residual impact of comparing gains with weak 2022 home prices wore off. CoreLogic projects that year-over-year home price gains will continue to rise at a slower pace for the rest of 2024, which suggests more certainty for potential homebuyers who have been waiting to get a foot in the door. As noted in the most recent US CoreLogic S&P Case-Shiller Index report, an increase in for-sale inventory also benefits potential homebuyers, though affordability remains a concern, particularly if mortgage rates remain elevated throughout the spring homebuying season.

“Home price growth pivoted in February, as the impact of the January 2023 Home Price Index bottom finally faded,” said Dr. Selma Hepp, chief economist for CoreLogic. “As a result, the U.S. should begin to see slowing annual home price gains moving forward.”

“Nevertheless,” Hepp continued, “with a 0.7% increase from January to February 2024, which is almost double the monthly increase recorded before the pandemic, spring home price gains are already off to a strong start despite continued mortgage rate volatility. That said, more inventory finally coming to market will likely translate to more options for buyers and fewer bidding wars, which typically keeps outsized price growth in check. Still, despite affordability challenges, homebuyer demand appears to favor already expensive, coastal markets with a limited availability of properties for sale.”
emphasis added

This was a smaller YoY increase than the 5.8% reported for January.

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