U.S. home price gains reached their highest rate in a year in January, according to CoreLogic’s Home Price Index (HPI). But the data provider forecasts yearly growth to begin slowing in the coming months and fall to 2.6% by early 2025.
U.S. annual home price growth rose by 5.8% in January 2024. On a monthly basis, home prices increased by 0.1%. In January, the annual appreciation of detached properties (6%) exceeded that of attached properties (4.9%) by 1.1 percentage points.
“Home prices further increased in late 2023 despite high mortgage rates, which surged to the highest level since the beginning of the millennium,” Selma Hepp, chief economist for CoreLogic, said in a statement.
“But metro areas that have struggled with the impact of higher rates continue to see downward movement on home prices. Generally, pressures from higher mortgage rates tend to occur in markets where the higher cost of homeownership pushes against the affordability ceiling.”
Rhode Island, New Jersey and Connecticut posted the biggest price increases for the year ending in January, with double-digit appreciation rates of 13.2%, 11.6% and 11%, respectively. Among the U.S. cities analyzed, Miami posted the highest year-over-year home price increase at 10.2%, followed by San Diego at 8.5% and Chicago at 7.3%.
Spokane, Washington; the Florida metros of Palm Bay and Ocala; and the Utah metros of Salt Lake City and Ogden posted the highest risks of price declines over the next year, according to CoreLogic’s Market Risk Indicator.