By Nicole Friedman
Home-price growth accelerated in December, as the number of homes on the market continued to decline.
The S&P CoreLogic Case-Shiller National Home Price Index, which measures average home prices in major metropolitan areas across the nation, rose 10.4% in the year that ended in December, up from a 9.5% annual rate the prior month. December marked the highest annual rate of price growth since January 2014.
House-buying demand has surged in recent months, driven by record-low interest rates. Sales of previously owned homes, which make up the bulk of the housing market, rose in 2020 to their highest annual level since 2006, according to the National Association of Realtors.
The supply of homes for sale has dropped, prompting buyers to compete for houses and buoying prices. There were 1.07 million homes for sale at the end of December, down 23% from December 2019, according to NAR.
The Case-Shiller 10-city index gained 9.8% over the year ended in December, compared with an 8.9% increase in November. The 20-city index rose 10.1%, after an annual gain of 9.2% in November.
"With buyer interest leading to an unseasonably competitive landscape...home prices remain on a steep upward trend," said George Ratiu, senior economist at Realtor.com. News Corp, parent of The Wall Street Journal, operates Realtor.com.
Economists surveyed by The Wall Street Journal expected the 20-city index to gain 9.9%.
The 20-city index measured 19 cities in December due to transaction reporting delays in Wayne County, Mich., according to S&P Dow Jones Indices. Price growth accelerated in 18 of the 19 cities.
Phoenix had the fastest home-price growth in the country for the 19th straight month, at 14.4%, followed by Seattle at 13.6%.
A separate measure of home-price growth by the Federal Housing Finance Agency also released Tuesday found an 11.4% increase in home prices in December from a year earlier.
Write to Nicole Friedman at firstname.lastname@example.org
(END) Dow Jones Newswires
February 23, 2021 09:26 ET (14:26 GMT)Copyright (c) 2021 Dow Jones & Company, Inc.