The FHFA (Federal Housing Finance Agency) released their House Price Index, which measures home price appreciation on single-family homes with conforming loan amounts. Different than Case Shiller, it does not include cash buyers or jumbo loans. The FHFA reported that prices were down 0.1% in November and are up 8.2% year over year. Home prices, according to FHFA, are only down 1.2% from their peak. Based on this, you can interpolate that the decline in Case Shiller is coming from higher priced homes where there is less demand. Additionally, there is likely cash discounts being offered, where buyers paying in cash are able to command a lower price, which is why Case Shiller is also lower. Here is a quote from the FHFA, which sounds similar to what we have been saying: “U.S. house prices were largely unchanged in the last four months and remained near the peak levels reached over the summer of 2022, While higher mortgage rates have suppressed demand, low inventories of homes for sale have helped maintain relatively flat house prices.”