Home Prices Rise for the First Time in Months

Annual home price growth accelerated in November for the first time in seven months, reflecting the market’s sensitivity to mortgage rate changes. According to the latest S&P CoreLogic Case-Shiller Index, home prices rose 3.8% year-over-year, up from October’s 3.6% increase. The modest gain followed a brief dip in mortgage rates in September, when they dropped to near 6% before climbing back to around 7%.

Regional Variations in Price Growth

The Case-Shiller 20-city composite index showed a 4.3% annual price increase, slightly higher than October’s 4.2%. New York City led the nation with a 7.3% year-over-year gain, while Tampa was the only metro area to post a decline, falling 0.4%. Chicago and Washington, DC, also saw strong annual price growth, at 6.2% and 5.9%, respectively.

Housing Market Remains Sensitive to Mortgage Rates

The latest data suggests that home prices remain responsive to changes in borrowing costs. The temporary mortgage rate decline in early fall appears to have supported price growth in November, despite overall affordability challenges. However, while price appreciation has resumed, it remains below pre-pandemic levels and well below the rapid gains seen in 2022, when annual price growth exceeded 20%.

Southern and Western Markets Show Weakest Gains

While most metro areas recorded price increases, growth in the South and West was notably weaker. Dallas, Denver, Phoenix, and San Francisco all saw home prices rise by less than 2% year-over-year. Meanwhile, markets in the Northeast and Midwest outperformed, with the Northeast posting the strongest regional gains at an average of 6.1%.

Market Outlook

The latest home price data highlights the ongoing influence of mortgage rate shifts on the housing market. As borrowing costs fluctuate, price trends will likely continue to vary by region, with some markets seeing stronger growth than others.