Record-Breaking Home Prices

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index achieved an unprecedented high in June 2024. This comprehensive measure, encompassing all nine U.S. census divisions, showcased a 5.4% yearly increase, a slight decrease from the previous month’s 5.9% gain.

Metropolitan Area Performance

Among the 20 cities analyzed, New York led with a remarkable 9.0% annual increase. San Diego and Las Vegas followed closely, reporting 8.7% and 8.5% yearly gains, respectively. In contrast, Portland experienced the most modest growth, with a 0.8% annual rise.

The 10-City Composite reflected a 7.4% yearly increase, while the 20-City Composite recorded a 6.5% gain. Both figures represent a slight deceleration from the previous month’s results.

Monthly Trends

Before seasonal adjustments, the U.S. National Index, 20-City Composite, and 10-City Composite all showed positive momentum, with increases of 0.5%, 0.6%, and 0.6%, respectively. However, these figures indicate a slowing pace compared to earlier months.

After accounting for seasonal factors, the U.S. National Index posted a modest 0.2% monthly change. The 20-City and 10-City Composites demonstrated slightly stronger performance, with 0.4% and 0.5% monthly increases, respectively.

Expert Insights

Brian D. Luke, CFA, Head of Commodities, Real & Digital Assets at S&P Dow Jones Indices, offered valuable context:

“Home prices continue to outpace inflation, exceeding historical norms. The gap between housing costs and the Consumer Price Index is currently one percentage point above the 50-year average.”

Luke also highlighted the significant long-term appreciation of home values: “Since 1974, home prices have surged over 1,100 percent before adjusting for inflation. Even after accounting for inflation, prices have more than doubled, showing a 111% increase.”

Affordability Trends

The analysis revealed interesting patterns in the affordability of homes across different price tiers:

  1. In 75% of markets studied, lower-priced homes appreciated faster than the overall market over the past five years.
  2. Atlanta’s lower-tier homes rose 18% faster than mid- and high-tier properties.
  3. New York showed the most significant disparity, with low-tier homes outperforming the overall market by nearly 20%, while high-tier homes lagged by 5.1%.
  4. San Diego bucked the trend, with high-tier homes appreciating 79% over five years, compared to 63% for lower-tier properties.

These findings underscore the complex and varied nature of housing markets across the United States, with implications for affordability and investment strategies in different regions.