Home-price growth starting to cool down

While home prices are still way up across the United States, recent data shows that things may be starting to cool down. Recently released information from the S&P CoreLogic Case-Shiller National Home Price Index highlights a downward trend in the growth of home prices across the country.

According to the Case-Shiller Index, which measures changes in the price of existing single-family home sales across the U.S., home price-growth slowed for the second month in a row in October 2021, the last month for which data is available.

The average price of a home was up 19.1% in the year that ended in October, down from 19.7% the previous month. Home prices are still up dramatically from a year ago, but these numbers suggest that the market has potentially peaked and that prices are on their way back down.

To this point, it should be added that the four months from July to October, 2021, showed the four highest annual price gains in the 34 years that the S&P has recorded this data.

These dramatic increases in home prices are fueled in large part by historically low interest rates and extremely low inventory. With the world approaching the second full year of the COVID-19 pandemic, it is likely that much of the uncertainty and volatility that has fueled this red hot market may continue into 2022.

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