Redfin Home Price Index Climbs 0.4% Month-Over-Month in December

Redfin reported on Tuesday (1-23-24) that according to its Redfin Home Price Index (RHPI), US home prices climbed 0.4% month-over-month in December—the smallest increase since June 2023 and the third consecutive month of slowing price growth. Year-over-year, prices increased 6.6%.

According to the RHPI, 15 of the 50 most populous US metropolitan areas saw month-over-month declines in December, although all but one of those declines were less than 1%. Austin, Texas, dropped 1.1%, followed by Oakland, California, down 0.9%; Sacramento, California, down 0.8%; Miami, Florida, down 0.6%; and Nashville, Tennessee, down 0.6%.

On the other hand, Chicago, Illinois, home prices climbed 2.6% from November. Rounding out the top 5 increases are San Jose, California, up 1.7%, followed by Pittsburgh, Pennsylvania, up 1.6%; Virginia Beach, Virginia, up 1.4%; and Charlotte, North Carolina, up 1.1%.

Commenting on the results of the RHPI report, Redfin Senior Economist Shehryar Bokhari said:

“Many home purchases that closed in December were negotiated in November, when mortgage rates were near the highest level in over two decades. That likely depressed home price growth because buyers were grappling with limited purchasing power.

Homebuyers can take solace in the fact that prices are unlikely to balloon again like they did during the pandemic homebuying frenzy, but they probably won’t fall any time soon, either. That’s because supply isn’t growing enough to bring prices down, and mortgage rates are no longer falling enough to drive prices up significantly.”