Home prices in the U.S. accelerated at their fastest pace of the year in October despite mortgage rates simultaneously climbing to their highest level in over two decades.
U.S. home prices rose 4.8% annually in October, which was up from an annual 4% increase the previous month, according to the latest S&P CoreLogic Case-Shiller Index data for October 2023.
The national Case-Shiller index — a leading measure of U.S. home prices — is a trailing three-month indicator that measures the month-over-month change in single-family home value. Overall, 11 of the 20 major metros measured in October saw monthly price increases.
“U.S. home prices accelerated at their fastest annual rate of the year in October,” said Brian Luke, head of Commodities, Real & Digital assets at S&P DJI.
“Our National Composite rose by 0.2% in October, marking nine consecutive monthly gains and the strongest national growth rate since 2022. We are experiencing broad-based home price appreciation across the country, with steady gains seen in 19 of 20 cities,” he said.
The 10-City Composite Index showed an increase of 5.7% in October, which was up from a 4.8% increase in the previous month, the report states. The composite covers 10 metro areas, including Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, New York, San Diego, San Francisco, and Washington, D.C.
Meanwhile, the 20-City Composite Index posted a 4.8% annual increase, marking the largest increase since November 2022. The 20-City Composite includes all metros in the 10-City Composite plus Atlanta, Charlotte, Cleveland, Dallas, Detroit, Minneapolis, Phoenix, Portland, Seattle, and Tampa.
Close to home, Dallas registered a 0.3% decrease in home prices in October after a 0.1% decrease in September, according to the report. Despite declining price growth in Dallas, homes are still up 1.2% on the year.
Detroit kept pace as the fastest-growing market for the second month in a row, registering an 8.1% annual gain. San Diego maintained the second spot with an annual gain of 7.2%, followed by New York with a 7.1% gain.
“The Midwest and the Northeast region are fastest growing markets, while the Southwest and West regions have lagged other regions for over a year,” said Luke. “A solid, if unspectacular report, this month’s index reflects a rising tide across nearly all markets.”
“Home prices leaned into the highest mortgage rates recorded in this market cycle and continued to push higher. With mortgage rates easing and the Federal Reserve guiding toward a slightly more accommodative stance, homeowners may be poised to see more appreciation.”