Home prices decelerated in January, posting an annual gain of 0.9%, according to the S&P Cotality Case-Shiller U.S. National Home Price NSA Index. The price growth in January is down from the 1.1% annual increase recorded in December.
January marked the eighth consecutive month that inflation outpaced national home price appreciation. The Consumer Price Index ran 1.5 percentage points above the 0.9% annual gain, leaving real home values modestly lower year over year.
“Splitting the year into two halves sharpens the picture,” said Nicholas Godec, head of fixed income tradeables and commodities at S&P Dow Jones Indices. “The National Index rose 2.2% over the first six months of the period, then fell 1.3% over the most recent six—a swing that explains why annual gains have compressed to under 1% despite prices remaining historically elevated.”
The 10-City Composite Index saw an annual increase in home prices of 1.7% in January, down from a 2% annual gain in the previous month. The 20-City Composite also decelerated to a 1.2% annual gain in January from a 1.4% increase in December. On a metro level basis, New York (+4.9%) reported the highest annual gain among the 20 cities analyzed, followed by Chicago (+4.6%) and Cleveland (+3.6%). Tampa posted the lowest return in January, with prices falling 2.5%.
On a month-over-month basis, the 10-City and 20-City Composite Indices decreased by 0.3% and 0.1%, respectively.
“Monthly price changes were slightly negative before seasonal adjustment and modestly positive after—consistent with a market that is neither recovering nor correcting sharply,” Godec said. “With 30-year mortgage rates still near 6%, affordability constraints show no sign of easing. Nominal prices are barely rising; in real terms, they are edging lower.”
