National home prices closed out 2013 by increasing 11.3 percent, representing a slight improvement over last quarter's annual rate of 11.2 percent, according to data released Tuesday by S&P Dow Jones Indices for its S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices. In the fourth quarter of 2013, the National Index declined 0.3 percent.
In December, the 10-City Composite remained relatively unchanged while the 20-City Composite showed its second consecutive monthly decline of 0.1 percent. Year-over-year, the 10-City and 20-City composites posted gains of 13.6 percent and 13.4 percent, respectively, approximately 30 basis points lower than their November rates. Among the highlights:
• Only six cities - Dallas, Las Vegas, Miami, San Francisco, Tampa and Washington - posted gains for the month of December.
• All 20 cities showed positive year-over-year increases.
• Chicago showed its highest year-over-year return since December 1988.
• Dallas set a new peak and posted its largest annual gain since its inception in 2000.
• Denver declined 0.1 percent and is now 0.7 percent below its all-time index level high set in September 2013.
• Phoenix posted -0.3 percent for the month of December, its largest decline since March 2011. Phoenix once led the recovery from the bottom in 2012.
• Las Vegas, Los Angeles and San Francisco were the top three performing cities of 2013 with gains of over 20 percent.
• The Sun Belt, with the exception of Dallas, Miami and Tampa, saw lower annual rates in December when compared to their November numbers.
"The S&P/Case-Shiller Home Price Index ended its best year since 2005," David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, said in a statement. "However, gains are slowing from month-to-month, and the strongest part of the recovery in home values may be over. Year-over-year values for the two monthly Composites weakened and the quarterly National Index barely improved."
Recent economic reports suggest a bleaker picture for housing, Blitzer added. Existing home sales fell 5.1 percent in January from December to the slowest pace in over a year. Permits for new residential construction and housing starts also were down and below expectations. "Some of the weakness reflects the cold weather in much of the country," he said. "However, higher home prices and mortgage rates are taking a toll on affordability. Mortgage default rates are back to their pre-crisis levels but bank-lending standards remain strict."
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