December Case-Shiller Results & Forecast: Reaccelerating
After cooling from record highs reached in the Fall, home price appreciation began to reaccelerate to end the year.
- The S&P CoreLogic Case-Shiller U.S. National Home Price Index® rose 18.8% year-over-year in December (non-seasonally adjusted), unchanged from November.
- Annual growth was faster in December than November in both the 20-city index (to 18.6%, from 18.3%) and 10-city index (to 17% from 16.9%).
- Annual growth was faster in December than November in 15 of the 20 markets included in the 20-city index.
After cooling from record highs reached in the Fall, home price appreciation began to reaccelerate to end the year as a combination of limited for-sale inventory and persistent demand continued to keep competition elevated.
The national Case-Shiller Home Price Index rose 18.8% year-over-year in December, unchanged from November. But non-seasonally adjusted annual growth was faster in December than November in both the smaller 20-city composite index (to 18.6%, from 18.3%) and 10-city index (to 17% from 16.9%), reversing the trend from prior months. On a monthly (seasonally adjusted) basis, the national index was up 1.3% from November, while the 10- and 20-city indices were up 1.4% and 1.5% month-over-month, respectively.
| ZILLOW FORECAST, RELEASED 1/25/22 | ACTUAL CASE-SHILLER INDICES, RELEASED 2/22/22 |
HISTORICAL MEDIAN ABSOLUTE ERROR* | |
|---|---|---|---|
| 10-City Composite, Month-Over-Month (SA) |
1.4% | 1.4% | 0.2% |
| 10-City Composite, Year-Over-Year (NSA) |
16.8% | 17% | 0.2% |
| 20-City Composite, Month-Over-Month (SA) |
1.5% | 1.5% | 0.2% |
| 20-City Composite, Year-Over-Year (NSA) |
18.4% | 18.6% | 0.1% |
| U.S. National Month-Over-Month (SA) |
1.2% | 1.3% | 0.1% |
| U.S. National Year-Over-Year (NSA) |
18.8% | 18.8% | 0.1% |
| *Calculation of Median Absolute Errors are based on Zillow’s forecasts dating to 2011. The national Case-Shiller forecasts began in 2014. | |||
The already-slim pickings of homes for-sale fell sharply in December, hitting new record lows and leaving home shoppers with a little more than half the selection that buyers from two years prior had at their disposal. And while the scarce selection has likely dissuaded some would-be shoppers from testing the market, overall demand for homebuying remained very strong by historic norms. Homes that sold in December typically left the market about a month faster than those homes that sold in December 2019 did. This demand may be tested in the coming months as mortgage rates press firmly higher, but early indications are that competition for housing may have only intensified to begin the year, setting the market up for a red-hot spring shopping season.
Monthly growth in January as reported by Case-Shiller is expected to accelerate from December in the 20-city and national indices, and slow in the 10-city index. The pace of annual growth is expected to climb in all three indices. S&P Dow Jones Indices is expected to release data for the January S&P CoreLogic Case-Shiller Indices on Tuesday, March 29.
| INDEX | ACTUAL DECEMBER CASE-SHILLER CHANGE |
ZILLOW’S FORECAST FOR THE CASE-SHILLER JANUARY INDICES |
|---|---|---|
| 10-City Composite, Month-Over-Month (SA) |
1.4% | 1.1% |
| 10-City Composite, Year-Over-Year (NSA) |
17% | 17.2% |
| 20-City Composite, Month-Over-Month (SA) |
1.5% | 1.7% |
| 20-City Composite, Year-Over-Year (NSA) |
18.6% | 18.8% |
| U.S. National Month-Over-Month (SA) |
1.3% | 1.4% |
| U.S. National Year-Over-Year (NSA) |
18.8% | 18.9% |
Note: Case-Shiller and Case-Shiller Index are registered trademarks of CoreLogic Solutions, LLC. The statements herein are not endorsed by or provided in association or connection with CoreLogic, LLC.
