After leveling off in August, annual home price growth began decelerating in September, according to the latest S&P CoreLogic Case-Shiller National Home Price Index report released Tuesday.
The index showed a 19.5% annual gain for the year ending in September 2021, dropping from 19.8% the month prior. This slow down comes after four consecutive months of record growth from April through July of this year.
“Housing prices continued to show remarkable strength in September, though the pace of price increases declined slightly,” Craig Lazzara, the managing director at S&P DJI, said in a statement. “This month, however, the rate of price growth began to decline, as each of our three composites rose less in September than in August.”
The Case-Shiller 20-city home price index increased 19.1% year-over-year in September, however this increase was down from the 19.6% increase posted a month prior. The 10-City index also showed signs of deceleration, dropping from 18.6% year-over-year growth in August to a 17.8% increase in September.
“September’s price increase ranked in the top quintile of historical experience for all 20 cities, and in the top decile for 17 of them,” Lazzara said in a statement. “That said, in 14 of 20 cities, prices decelerated – i.e., increased by less in September than in August.”
Phoenix again led the 20-city home price index, posting a 33.1% annual gain, followed by Tampa and Miami, which saw 27.7% and 25.2% annual gains, respectively.
“While housing market activity is experiencing a typical seasonal slowdown, home buyer demand remains strong and continues to push total home purchases above pre-pandemic levels, resulting in another month of close to 20% annual gains in home prices,” Selma Hepp, CoreLogic’s chief economist, said in a statement. “Nevertheless, while activity continues to outperform pre-pandemic levels, there are encouraging signs of a slow albeit welcomed return to more sustainable balance between buyers and sellers. There is still low availability of for-sale homes, which continues to drive price growth, but the competition has faded and assuaged some of the bidding war intensity. Overall, home price growth is likely to continue slowing over the next year.”
Month-over-month, the national home price index posted a 1% increase, while the 10-city and 20-city indexes rose 0.7% and 0.8% from August, respectively.
Chicago, Minneapolis and Washington D.C. saw the smallest annual home price gains in September, though the gains were all still over 10%.