S&P Case-Shiller suggests that the decline in home prices may have come to an end

The housing market is experiencing fierce competition and a shortage of supply, leading to a surge in home prices.

According to S&P CoreLogic Case-Shiller Indices, national home prices in March were 0.7% higher than in March 2022.

Craig J. Lazzara, the managing director at S&P DJI, stated, “The modest increases in home prices we observed last month have intensified in March 2023. While two months of rising prices do not guarantee a definitive recovery, March’s results suggest that the decline in home prices, which began in June 2022, may have come to an end.”

The 10-city composite, which includes the Los Angeles and New York metropolitan areas, witnessed a 0.8% year-over-year decrease compared to the previous month’s 0.5% increase. Similarly, the 20-city composite, which includes Dallas-Fort Worth and the Detroit area, experienced a 1.1% decline after previously reporting a 0.4% annual gain.

However, home prices are showing a monthly increase. After seasonal adjustment, national prices rose by 0.4% in March compared to February. The 10-city composite saw a gain of 0.6%, while the 20-city composite rose by 0.5%.

Lazzara also highlighted that the nationwide price acceleration was evident at a more detailed level. Before seasonal adjustment, all 20 cities saw a price increase in March (compared to 12 cities in February), and all 20 cities experienced an acceleration in price gains between February and March.

In March, Miami, Tampa, Florida, and Charlotte, North Carolina, reported the highest year-over-year gains among the 20 cities. Charlotte replaced Atlanta in third place. Out of the 20 cities, only Chicago reported an increase of 0.4%, while the rest witnessed lower prices compared to a year ago.

Lazzara added, “One of the most intriguing aspects of our report lies in its distinct regional differences. As we move further west, prices become weaker, with Seattle (-12.4%) currently leading San Francisco (-11.2%) at the bottom of the ranking. It’s not surprising that the Southeast (+5.4%) remains the country’s strongest region, while the West (-6.2%) continues to be the weakest.”