According to the latest S&P CoreLogic Case-Shiller National Home Price Index, home prices in the United States grew by 3.2% in September. This is up from a revised 3.1% in August, providing increasing evidence that the housing market cooldown ended in late summer. However, home prices in San Francisco continue to lag the 20-city markets, where home prices are falling by 0.7% year-over-year.
Average home price growth in the top 10 metropolitan areas increased by 1.5%, unchanged from the previous month. In addition, the top 20 metropolitan areas saw home prices growth increase from the previous month, growing from 2% in August to 2.1% in September. Just eight of the top 20 metropolitan areas reported lower price increases compared to the previous month, which is down from 11 in August. This is yet another sign that the housing market slowdown ended in the middle of this year.
Phoenix sits at the top of the pack for the fourth straight month but saw its pace of growth decrease from August, slowing from 6.3% to 5.7%. Phoenix is followed by Charlotte, North Carolina and Tampa, Florida as the fastest- growing housing market in the 20-city index, with home price growth of 4.6% and 4.5%, respectively. Las Vegas, which was in the top three metros with the largest price gains as recently as July, is now ranked 12 out of the 20-city list. Home price growth in San Francisco falls for the second consecutive month, falling 0.7% year-over-year.
While this month’s report continues to suggest that persistently low mortgage rates have taken the chill out of the housing market cooldown, once-hot markets in the West are now some of the coolest markets in the United States. San Francisco and Las Vegas – once poster children for housing market boomtowns – have seen the most slowing of all 20-city markets at a 10.6 percentage point differential over the past year. Las Vegas has fallen from 13.4% year-over-year growth in September 2018 to just 2.9% in September 2019, while San Francisco’s price growth fell from 9.9% to -0.7% over the same period. Clearly, first-time homebuyers in these markets have something to be thankful for this holiday season.
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