Case-Shiller Report Suggests Growth in Housing Prices Might Be Decelerating
It’s too soon to tell how the pandemic-long spikes are from the move from urban to suburban.
August data provided by the S&P CoreLogic Case-Shiller Indices, suggests that the growth in housing prices, while still very strong, may be beginning to decelerate.
“We have previously suggested that the strength in the US housing market is being driven in part by a reaction to the COVID pandemic, as potential buyers move from urban apartments to suburban homes,” Craig J. Lazzara, Managing Director and Global Head of Index Investment Strategy at S&P DJI, said in prepared comments. “More data will be required to understand whether this demand surge represents an acceleration of purchases that would have occurred anyway over the next several years, or reflects a secular change in locational preferences.
“August’s data are consistent with either explanation. August data also suggest that the growth in housing prices, while still very strong, may be beginning to decelerate,” he concluded.
Phoenix Tops List for 27th Straight Month
Phoenix’s 33.3% increase led all cities for the 27th consecutive month. San Diego (+26.2%) continued in second place, but in August, Tampa (+25.9%) edged Dallas and Seattle for the bronze medal.
As has been the case for the last several months, prices were strongest in the Southwest (+24.1%), but every region logged double-digit gains, according to the release.
The index covers all nine US census divisions, and it reported a 19.8% annual gain in August, remaining the same as the previous month. The 10-city composite annual increase came in at 18.6%, down from 19.2% in the previous month.
20-City Composite Up 19.7% YoY
The 20-city composite posted a 19.7% year-over-year gain, down from 20.0% in the previous month.
Eight of the 20 cities reported higher price increases in the year ending August 2021 versus the year ending July 2021.
Before seasonal adjustment, the U.S. National Index posted a 1.2% month-over-month increase in August, while the 10-City and 20-City Composites both posted increases of 0.8% and 0.9%, respectively.