Home price gains rebounded in January after cooling off at the end of last year.
Home prices nationally rose 19.2% in January, up from 18.9% in December. The annual increase for the 10 cities was 17.5%, up from 17.1% in the previous month. The 20-city index increased from 18.6% in December to 19.1% in January.
Miami had the biggest annual gains at 28.1%. In the year ending January 2022, 16 of the 20 cities reported higher price increases.
Washington, D.C., Minneapolis and Chicago were all up double digits from a year ago.
Demand and supply appear to be more important than rising mortgage rates, which would usually take some of the heat out of housing.
Mortgage rates began to climb in January, despite the index being a three-month average. According to Mortgage News Daily, the average rate on the 30-year fixed ended in January at 3.68%. It's flirting with 5%.
The macroeconomic environment is changing rapidly. The Federal Reserve has begun to increase interest rates in response to rising inflation. Craig Lazzara, managing director at S&P, said that they may soon see the impact of increasing mortgage rates on home prices.
In the first months of the year, higher mortgage rates are affecting sales. According to the National Association of Realtors, pending home sales have fallen for four months in a row.
The monthly payment for a median-priced home has gone up 30% in the past year, far outdistancing even fast-rising consumer prices.
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