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Economic Report: Home prices increase at fastest rate in 34 years in December, but rising mortgage rates remain a threat

The numbers: The S&P CoreLogic Case-Shiller 20-city price index posted a 18.6% year-over-year gain in December, up slightly from 18.3% the previous month. On a monthly basis, the index increased 1.5% between November and December.

Meanwhile, the Case-Shiller national home price index demonstrated 18.8% growth between 2020 and 2021 in December, in line with November’s reading.

The Federal Housing Finance Agency House Price Index showed that prices rose 17.5% between the fourth quarters of 2020 and 2021. Prices were up 1.2% between November and December, per the FHFA report.

Looking ahead: “Home prices continued to surpass expectations in December, but a marked change may be ahead for growth as rising mortgage rates eat into homebuyer purchasing power,” said Danielle Hale, chief economist at “While typical asking prices continue to accelerate, the pace of median sales price growth has slowed, signaling a potential gap between what buyers are willing and able to pay and what sellers are hoping to net.”

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