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Home prices leaped ever-higher in February despite rising mortgage rates, according to data released Tuesday by the S&P CoreLogic Case-Shiller Indices.
U.S. home prices posted a 6.4 percent annual gain on a national level in February and rose 0.6 percent month over month, according to the new data.
“Following last year’s decline, U.S. home prices are at or near all-time highs,” Brian D. Luke, head of commodities, real and digital assets at S&P Dow Jones Indices said in a statement.
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All of the cities in the top-10 and top-20 composites posted increases in annual prices for the third-consecutive month, with both composites sitting at all-time highs according to the report. Four cities in the index — San Diego, Los Angeles, Washington, D.C., and New York — all currently sit at all-time highs for housing prices.
San Diego witnessed the most dramatic increase of all the cities in the index, with prices up 11.4 percent since February 2023 and reaching 1.7 percent between January and February. San Diego was followed by Chicago and Detroit, each of which notched annual increases of 8.9 percent.
With Los Angeles prices also on the rise, meanwhile, Southern California continues to outperform its regional neighbors, with San Francisco prices falling 12 percent from a pandemic peak and Phoenix and Las Vegas dipping 6 percent and 4.5 percent, respectively, year over year.
Portland, Oregon, experienced the slowest rate of growth with a 2.2 percent annual increase in home prices, according to the Case-Shiller Indices.
“Since the previous peak in prices in 2022, this marks the second time home prices have pushed higher in the face of economic uncertainty,” Luke said. “Enthusiasm for potential Fed cuts and lower mortgage rates appears to have supported buyer behavior, driving the 10 and 20-city Composites to new highs.”
Also released Tuesday, the Federal Housing Finance Authority’s House Price Index found that United States home prices were up 1.2 percent from January, and had grown 7 percent since February 2023.
Over the past six months markets in the Northeast such as Boston, New York, and Washington, D.C. have performed the strongest, according to S&P data, contrasting previous years wherein Sun Belt markets like Phoenix and Miami were the standouts, which Luke attributed to a possible end of remote work policies having a noticeable impact on housing patterns.
“As remote work benefitted smaller (and sunnier markets) in the first part of the decade, return to office may be contributing to outperformance in larger metropolitan markets in the Northeast,” Luke said.
