Home Prices Unexpectedly Rose in February

Home prices unexpectedly rose in February, the latest signal that the housing market began to recover earlier than expected after months of downward pressure from higher interest rates.

The closely watched S&P CoreLogic Case-Shiller 20-City Composite Index rose 0.2 percent before seasonal adjustment in February compared with the previous month. The prior month’s unadjusted figure was revised to show a 0.6 percent decline, down from the initial estimate of a 0.5 percent drop.

The seasonally adjusted 20-City Composite Index rose 0.1 percent, beating the consensus estimate for a 0.3 percent decline. The prior month had seen a 0.4 percent decline.

The 20-City Composite was up 0.4 percent compared with a year ago. That’s down from the 2.6 percent 12-month gain recorded in January but better than the zero gain expected by analysts.

On a month-over-month basis, the national index rose 0.2 percent before seasonal adjustment in February, the first month-over-month gain after seven months of declines. The 10-City index rose 0.3 percent.

Compared with a year ago, the 10-City Composite Index also rose 0.4 percent, down from the 2.5 percent rise in the previous month. The National Home Price index rose two percent over the past year, down from the 3.7 percent gain expected.

The National Composite is down 4.9 percent below its June peak. The 10-City Composite is six percent below its peak. The 20-City is 6.6 percent below its peak.

“The moderation we observed nationally was also apparent at a more granular level. Before seasonal adjustment, prices rose in 12 cities in February (versus in only one in January),” said Crag Lazzara, Management Director at S&P DJI.

On a seasonally adjusted basis, nine cities saw rising prices, up from five in January.

“With or without seasonal adjustment, most cities February results showed improvement relative to their January counterparts,” Lazarra said.