In November, indices tracking U.S. home prices surpassed a historic high point of nearly 15 years ago.
The S&P CoreLogic Case-Shiller US National Home Price Index rose 9.5 percent year-over-year in November, up from 8.4 percent in October. The monthly index is about 26 percent higher than the previous peak of July 2006.
The 20-city home price index, which tracks the housing market in 20 cities including New York City, Los Angeles, Miami and Chicago, similarly reported a 9.1 percent increase, up 1.1 percent from the prior month. The index is 15.5 percent above its previous high point in 2006.
The cities of Phoenix, Seattle and San Diego again reported the biggest annual gains, though all 19 cities included in the index saw year-over-year increases. Detroit is typically included in the index, but pandemic-related delays recording sales have temporarily excluded it in recent months.
Craig Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices, attributed the soaring prices to homebuyers moving from urban to suburban homes.
He said it’s not yet clear whether the pandemic fueled these purchases or simply accelerated the timeline for buyers who were already interested in moving out of cities.
“This may represent a true secular shift in housing demand, or may simply represent an acceleration of moves that would have taken place over the next several years anyway,” Lazzara said in a statement. “Future data will be required to address that question.”
Housing prices climbed over $300,000 for the first time in summer 2020, driven by the strongest demand from buyers in 14 years and historically low levels of inventory. The median sales price of existing homes ended the year at $309,800, according to the National Association of Realtors.