Composite-20 HPI: Yearly Gains Ease to 4.6%, Monthly Declines Highlight Market Pressure

What Do Year-Over-Year Figures Show?

The S&P CoreLogic Case-Shiller 20-City Composite Home Price Index (HPI) recorded a year-over-year increase of 4.6% in September, down from 5.2% in August. This marks a continued deceleration in annual price growth as affordability challenges and high mortgage rates weigh on the housing market.

Among the 20 cities tracked, New York led with a 7.5% annual price gain, followed by Cleveland and Chicago at 7.1% and 6.9%, respectively. Conversely, Denver posted the weakest performance with a marginal 0.2% year-over-year increase, reflecting its sensitivity to affordability constraints.

How Did Prices Change Month-Over-Month?

On a month-over-month basis, the Composite-20 HPI declined by 0.3% in September before seasonal adjustments, mirroring the broader slowdown in housing demand. This decline follows a pattern seen in the national index (-0.1%) and the 10-City Composite (-0.4%).

After seasonal adjustments, however, the Composite-20 index edged up by 0.2% for the month, signaling that demand remains resilient in some regions. While monthly declines highlight immediate pressures, adjusted figures suggest the market is holding ground where inventory constraints persist.

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Regional Highlights and Drivers

Regional disparities remain stark within the Composite-20 cities. Robust annual growth in New York, Cleveland, and Chicago reflects steady demand and constrained inventory. On the other hand, weaker performances in cities like Denver signal affordability challenges stemming from elevated mortgage rates.

The contrast between annual and monthly trends underscores the impact of seasonality and regional economic conditions. Notably, the seasonal uptick in adjusted monthly figures shows the underlying resilience in key urban centers.

Market Forecast

The Composite-20’s slowing annual growth and mixed monthly performance suggest a cautiously bearish outlook in the short term. Housing markets face headwinds from persistent affordability pressures and high borrowing costs, though inventory shortages may offer support in select regions. Traders should anticipate subdued momentum in housing-linked equities and closely monitor high-growth cities like New York and Chicago for signs of continued resilience.