Southern California Housing Markets Lead Nation in Price Gains, According to Case-Shiller Rankings
Southern California Housing Markets Lead Nation in Price Gains
In a recent report by S&P CoreLogic Case-Shiller, two Southern California housing markets have topped the rankings for price gains. San Diego led the 20 cities tracked with an impressive 11.2% increase in the 12 months ending in January, while prices in Los Angeles-Orange County were up 8.6%.
Nationally, home-price growth accelerated at the fastest rate since 2022, putting pressure on buyers after a challenging year for property sales. Prices across the country climbed 6% in January from a year earlier, surpassing the 5.6% annual gain in December.
The housing market has been difficult to navigate since borrowing costs started rising in 2022, limiting the purchasing power of many potential buyers. Although inventory has started to increase recently, the supply of homes for sale remains low by historical standards, contributing to the high prices.
Brian Luke, head of commodities, real and digital assets at S&P Dow Jones Indices, commented on the situation, stating, “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. No matter which way you slice it, the index performance closely resembled the broad market.”
Looking ahead, the spring home buying season is expected to elevate home prices from winter lows. However, the rate of annual gains is likely to slow due to challenging comparisons with last year’s spring surge in home prices. Despite this, annual gains are projected to remain solid, with another 3%-4% increase expected this year, according to CoreLogic’s chief economist Selma Hepp.
In February, sales of previously owned US homes surged to the fastest pace in a year as the number of listings increased, indicating that buyers and sellers are adjusting to higher mortgage rates. Contract closings rose by 9.5% from the previous month to a 4.38 million annualized rate, according to National Association of Realtors data.
With the housing market showing resilience and continued growth, it will be interesting to see how these trends evolve in the coming months.