Case Shiller Home Prices: Continued Gains Amid Shutdowns

Bottom Line: Home prices nationwide rose for the fourth consecutive month in April, albeit modestly less than expected. Prices have continued to re-accelerate since late '19 and into '20 after rebalancing for the impact of tax changes in 2018. Mortgage rates were moving lower throughout the second half of 2019 and have held near record lows since March. Supply remained tight in most parts of the country, and demand was strong even before the shutdowns for the novel coronavirus put a higher value on single-family homes outside urban centers. Overall, the housing market has proven remarkably resilient in the face of this crisis and remains a sector likely to lead the economic recovery. The Cleveland area has been surprisingly strong, joining the usual hot spots Phoenix, Seattle, and Tampa. Chicago and New York, large metro areas with high taxes, remain the biggest laggards. Case Shiller 20-City Home Price Index ROSE by 0.33% (seasonally adjusted) in April to 223.9, compared with market expectations for an increase of 0.5%. Home prices are 4.0% ABOVE their year-ago level. Nationwide home prices are now just 8.3% ABOVE their April 2006 peak, near late 2005 levels and 63.7% ABOVE their January 2012 trough. On a non-seasonally adjusted basis, the home price index ROSE by 0.9% on the month. Housing prices rose in 17 of the 20 metro areas in April (on a seasonally adjusted basis) and in 19 of 20 metro areas on a year-over-year basis. Chicago had the smallest year-over-year increase at 1.7% while Phoenix had the largest year-over-year increase at 9.3%.