Economists' Outlook

Housing stats and analysis from NAR's research experts.

Latest Case Shiller Housing Price Index

  • Today, Case Shiller released their housing price index data for December 2014 which showed that house prices rose 4.3 percent from December one year ago for the 10-city composite, 4.5 percent for the 20-city composite, and 4.6 percent for the national index.
  • On Monday NAR reported growing prices in December and some acceleration in January.  Price growth in the year ended January 2015 was 6.3%.  FHFA December data is to be released on Thursday.
  • Case Shiller’s city by city data highlight some regional variation in price change.  Cities where prices are growing above normal pace, such as San Francisco (9.3 %), Miami (8.4%), Denver (8.1%), Dallas (7.5%), and Las Vegas (6.9%), are predominantly in the West.
  • Other areas where growth rates have been slower, like Chicago (1.3%), Cleveland (1.5%), Washington DC (1.5%), Minneapolis (1.9%), New York (1.9%), are concentrated in the Midwest and Northeast.
  • Case Shiller data, like NAR data is showing more even price growth across regions than we’ve seen in previous months as prices picked up a bit in previously slow growing areas and slowed down a bit in previously double-digit growth areas.
  • Also today, Fed Chair Janet Yellen delivered the semi-annual report on monetary policy to Congress.  Fed watchers looking for clues on when the Fed will begin to raise interest rates will note that Chair Yellen explained the FOMC’s use of the word “patient.” The Committee intends the word to mean that it is “unlikely that economic conditions will warrant an increase in the… [fed funds rate] for at least the next couple of FOMC meetings.”  Since the Committee left “patient” in the January statement, its next opportunity to be removed will come March 18 which suggests that the earliest Fed rate hike would come in June.
  • Those in the mortgage market in Spring 2013 will remember that mortgage rates can move strongly based on just the suspicion that the FOMC is going to raise rates.  In fact, from its February 5, 2015 low, the Freddie Mac weekly mortgage rate survey shows that 30-year fixed rates are up nearly 20 bps and other market indications are that trend will continue.

C-S Med Price
FHLMC 30 yr

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