Two Southern California housing markets topped the Case-Shiller rankings for price gains.
San Diego led the 20 cities tracked with an 11.2% increase in the 12 months ending in January, according to data from S&P CoreLogic Case-Shiller. Prices in Los Angeles-Orange County were up 8.6%.
Nationally, home-price growth accelerated at the fastest rate since 2022, increasing pressure on buyers after the worst year for property sales in nearly three decades.
Prices nationally climbed 6% in January from a year earlier. That’s bigger than the 5.6% annual gain in December.
The housing market has been tough to navigate since borrowing costs started soaring in 2022, squeezing the purchasing power of many shoppers. While inventory has started to rise recently, homes listed for sale remain low by historical standards, and the tight supply has helped keep prices high.
“Homeowners most likely saw healthy gains in the last year, no matter what city you were in, or if it was in an expensive or inexpensive neighborhood,” Brian Luke, head of commodities, real and digital assets at S&P Dow Jones Indices, said in a statement. “No matter which way you slice it, the index performance closely resembled the broad market.”
The index tracks the three months through January, when the average mortgage rate on a 30-year loan dropped from a high of 7.76% to 6.69%. Demand has started to pick up as borrowing costs eased, with sales of previously owned homes surging to the highest in a year in February.
“Going forward, spring home buying season will elevate home prices from winter lows, however the rate of annual gains is likely to slow given the difficult comparisons with last year’s spring surge in home prices. Still, annual gains will remain solid and likely show another 3%-4% increase this year,” said CoreLogic’s chief economist Selma Hepp.
Sales of previously owned US homes surged in February to the fastest pace in a year as the number of listings jumped, suggesting buyers and sellers are coming to grips with higher mortgage rates.
Contract closings increased 9.5% from a month earlier to a 4.38 million annualized rate, according to National Association of Realtors data.
Bloomberg News and Jonathan Lansner of the Southern California News Group added to this report.
