According to the latest S&P CoreLogic Case-Shiller National Home Price Index, home prices in the United States grew by 4.7 percent in December. This is the ninth consecutive month of slowing home-price growth, which is now at its lowest level since September 2015.
Average home prices for the top 10 metropolitan areas increased 3.8 percent, down from the previous month’s 4.2 percent increase. The top 20 metropolitan areas also posted a gain of 4.2 percent year over year, down from 4.6 percent in November. Further, 16 of the 20 metropolitan areas reported slower price increases month over month, up from 13 in the previous month.
Home prices have continued to rise quickly in the West of the country, but Atlanta has now taken over Seattle in the top three. Las Vegas (11.4 percent), Phoenix (8 percent) and Atlanta (5.9 percent) accounting for the highest year-over-year price increases. Conversly, metros west of the Mississippi also accounted for the largest growth slowdowns in December, with Seattle (7.7 point drop), San Francisco (5.7 point drop) and San Diego (5.1 point drop) experiencing the largest home-price growth declines over the past year.
Why is home price growth continuing to cool? A few reasons. First, mortgage rates hit near-term highs back in November, which likely limited homebuyers’ borrowing power for home purchases that closed in December. Second, inventory is finally rising after sinking to historic lows last year, which is helping ease what has been a fiercely competitive market over the past few years. As a result, we expect January’s S&P CoreLogic Case-Shiller National Home Price Index to slow to under 5 percent growth year over year.
 In the event that the change for consecutive months was identical to the previous months using one decimal point, we expand the measure to multiple decimal points to break the tie.
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