Home Price Growth Slows in December


In December, national home price appreciation continued, but at a slower pace than last month. Three metro areas, including San Francisco, Seattle and San Diego, experienced home price declines in December.

The Case-Shiller U.S. National Home Price Index, reported by S&P Dow Jones Indices, rose at a seasonally adjusted annual growth rate of 3.2% in December, less than the 4.5% increase in November. It was the lowest one in the past five months. On a year-over-year basis, the Case-Shiller U.S. National Home Price NSA Index rose by 4.7% in December, down from 5.1% in November.

The Home Price Index, released by the Federal Housing Finance Agency (FHFA), rose at a seasonally adjusted annual rate of 3.6% in December, slower than the 5.4% increase in November, confirming the deceleration in home prices.

In addition to tracking home price changes nationwide, S&P also reported home price indexes across 20 metro areas. In December, the annual growth rates of the 20 metro areas ranged from -10.6% to 7.8%, while half of the 20 metro areas exceeded the national average of 3.2%. Among the 20 metro areas, New York, Atlanta and Dallas had the highest home price appreciation. New York led the way with a 7.8% increase, followed by Atlanta with a 6.5% increase and Dallas with a 6.2% increase. Three metro areas experienced price declines in December and they are San Francisco (-10.6%), San Diego (-4.0%) and Seattle (-0.8%).

Seattle was one of the metro areas that led the nation in home price appreciation. Between December 2017 and May 2018, Seattle had reported double-digit home price appreciation, but that has changed recently. Home prices have declined for six consecutive months in Seattle since July 2018.

The Federal Housing Finance Agency (FHFA) released the seasonally adjusted data for each state and the District of Columbia quarterly. In the last quarter of 2018, the U.S. purchased-only House Price Index rose at a seasonally adjusted annual rate of 3.6% while the annualized growth rates of each state and the District of Columbia varied.

Figure 3 below shows the annualized quarterly percent changes in the House Price Index across 50 states and the District of Columbia in the fourth quarter of 2018. There were 24 states and the District of Columbia where house price growth exceeded the U.S. average and 21 states where house price growth was less than the U.S. average but still positive, while the rest 5 states recorded a decline in house prices over the past year. The District of Columbia lead the way with an annualized growth of 28.0%, while West Virginia had the largest decline of 5.8%.

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