What happened: Price growth accelerated ahead of the spring shopping season, as both buyers and sellers returned in February. The seasonally adjusted S&P CoreLogic Case-Shiller U.S. National Home Price Index® increased by 0.4% up from 0.3% in January. On an annual basis home prices were up 6.4% when compared a year ago. This is compared to just 6% in January.
Why it matters: Ahead of this report, Zillow data showed that new listings increased 20% in February and were up 21% from February 2023. Despite the large increase in new listings in February, price growth accelerated because housing demand continues to surprise on the upside nationally. Population growth, looser financial conditions, due in part to new stock market highs, as well as the strong labor market helped support housing demand at the start of this year. Home values increased most in coastal markets where supply tends to lag most like San Jose, San Diego, Seattle, San Francisco.
While we’re likely to continue to see price increase in the March data, rising mortgage rates in April combined with more supply could cause annual price growth to ease in 2024.