US home prices in America’s 20 largest cities rose 0.41% MoM in November (far better than the 0.3% MoM expected) according to the latest data from S&P CoreLogic’s Case-Shiller Index. That leaves prices up 4.33% YoY (up from 4.23% YoY in October) and the first acceleration in YoY price gains since March 2024
Source: Bloomberg
So 100bps of rate-cuts prompted a re-acceleration in home prices…
Source: Bloomberg
Arguably, (lagged) mortgage rates increased during that period, and dipped since (positive short-term for the highly smoothed and lagged Case Shiller series), but as is clear, things do not end well…
Source: Bloomberg
Tampa stands out with the only price drop on a YoY basis…
In fact Tampa prices are at their lowest since Oct 2023…
However, home price appreciation does seem to track very closely with bank reserves at The Fed (6mo lag)…
Source: Bloomberg
Which suggests the pace of home price appreciation is set to slow further from here.
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