The latest S&P CoreLogic Case Shiller Index indicates that property values in its 20-city index rose +4.2% in December 2018 compared with December 2017. Nationally, home prices climbed +4.7% in December 2018, the least home price increase since 2015.
Additionally, single-family construction starts were down -6.7% and multi-family starts were down -20.4% in December 2018, according to Stephen Stanley, chief economist with Amherst Pierport, and Laura Kane, head of investment with UBS. Both Pierport and Kane pointed to elevated housing costs and the falling stock market as cause and effects for slumping new construction projects. This was the weakest pace since 2016.
David Blitzer, managing director and chairman of the Indices Committee for the S&P CoreLogic Case Shiller National Home Price Index, said he believed that wage gains for approximately 3.5%-4% during the year were well below the nationwide home price increase of +4.7%, according to the Los Angeles Times.
All 20 cities in the CoreLogic Index showed y/y gains in home prices in December 2018.
- Las Vegas saw home prices increased +11.4%.
- Phoenix saw home prices increased +8%.
- Though still showing gains, home prices in San Diego, San Francisco and Seattle fell in December 2018 from November 2018 on a seasonally adjusted basis.
- Seattle (now ranked 11 with a +5.1%) and Portland (now ranked 16), formerly leaders in home price gains, saw their respective home price gains slow.
- The weakest home price gains centered in San Diego at +2.3%, formerly among the top four just 13 months ago. Last time San Diego was at the bottom of the Index was October 1996, according to the Los Angeles Times.
Despite the above gains listed, Las Vegas and Phoenix gains were below their respective 2016 peaks.
The Federal Housing Finance Agency issued a separate index report that corroborates the latest CoreLogic Index report. The FHFA report indicates that home prices rose +5.7% in Q4 2018, down from 6.5% in Q3 2018 and compared with Q4 2017. This rate of home price gain was the slowest gain made since Q1 2016.
To download your copy of this latest CoreLogic Home Price Index report, go to
https://www.corelogic.com/insights/home-price-index.aspx?WT.mc_id=crlg_190205_yUrTs
