by Calculated Risk on 3/25/2025 09:00:00 AM

S&P/Case-Shiller released the monthly Home Price Indices for January ("January" is a 3-month average of November, December and January closing prices).

This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the monthly National index.

From S&P S&P CoreLogic Case-Shiller Index Records 4.1% Annual Gain in January 2025

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 4.1% annual return for January, up from a 4% annual gain in the previous month. The 10-City Composite saw an annual increase of 5.3%, up from a 5.2% annual increase in the previous month. The 20-City Composite posted a year-over-year increase of 4.7%, up from a 4.5% increase in the previous month. New York again reported the highest annual gain among the 20 cities with a 7.7% increase in January, followed by Chicago and Boston with annual increases of 7.5% and 6.6%, respectively. Tampa posted the lowest return, falling 1.5%.
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The pre-seasonally adjusted U.S. National and 20-City Composite Indices presented slight upward trends in January, with both posting 0.1% increases. The 10-City Composite posted a monthly return of 0.2%.

After seasonal adjustment, the 20-City and 10-City Composite Indices posted month-over-month increases of 0.5%. The U.S National posted a month-over-month increase of 0.6%.

“Home price growth continued to moderate in January, reflecting a clear two-part story across the past year,” says Nicholas Godec, CFA, CAIA, CIPM, Head of Fixed Income Tradables & Commodities at S&P Dow Jones Indices. “The National Composite Index posted a 4.1% annual gain, with the bulk of appreciation—4.8%—occurring in the first half of the year. Prices declined 0.7% in the second half, as high mortgage rates and affordability constraints weighed on buyer demand and market activity.

“Among the 20 metro areas tracked by the Composite 20, New York City led annual gains with a 7.7% rise, followed closely by Chicago (7.5%) and Boston (6.5%). Tampa was the only market to post a year over-year decline, falling 1.5%. However, the second half of the year told a different story: San Francisco posted the largest six-month decline at 3.4%, followed by Tampa at 3.2%. Only four of the 20 cities managed to eke out price increases during this period—New York, Chicago, Phoenix, and Boston—highlighting broad-based cooling.

“Rising mortgage rates throughout the year elevated monthly payment burdens, which, combined with already high home prices, pushed affordability to multi-decade lows in many regions. This likely contributed to subdued activity in the back half of the year, with both buyers and sellers exercising caution. Inventory constraints also remain a challenge, particularly in legacy metro areas, where limited new construction continues to restrict supply.

“The strength in markets like New York and Chicago may reflect more normalized valuations relative to frothier regions, along with continued urban recovery trends post-pandemic. On the other hand, Sunbelt markets that experienced sharp run-ups earlier in the cycle—like Tampa and Phoenix—have seen the most pronounced slowdowns.
emphasis added

Click on graph for larger image.

The first graph shows the nominal seasonally adjusted Composite 10, Composite 20 and National indices (the Composite 20 was started in January 2000).

The Composite 10 index was up 0.5% in January (SA).  The Composite 20 index was up 0.5% (SA) in January.

The National index was up 0.6% (SA) in January.

The second graph shows the year-over-year change in all three indices.

The Composite 10 NSA was up 5.3% year-over-year.  The Composite 20 NSA was up 4.7% year-over-year.

The National index NSA was up 4.1% year-over-year.

Annual price changes were slightly higher than expectations.  I'll have more later.

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