Resale prices are more than cooling, they're contracting on a month-over-month basis. Down 0.5 percent for a third month in a row, Case-Shiller's 20-city adjusted index is now at its lowest level since February last year. Yet year-over-year, the latest result is still in the plus column compared to December 2021, at 4.6 percent which, however, is the lowest rate of annual appreciation since just before the great pandemic housing boom began to swell, in July 2020. Higher mortgage rates, the result of aggressive Federal Reserve tightening, are bringing down home prices which will improve affordability and help stimulate what have been declining sales of existing homes.

Forecasters see the adjusted 20-city monthly rate falling 0.5 percent in December to match November's 0.5 percent decline. The unadjusted annual rate is seen falling to 5.3 percent from 6.8 percent.

The S&P Corelogic Case-Shiller home price index tracks monthly changes in the value of residential real estate in 20 metropolitan regions across the nation. Composite indexes and regional indexes measure changes in existing home prices and are based on single-family home resales. Condominiums and co-ops are excluded as is new construction. Note that forecasters, in line with recommendations from Standard & Poor's questioning the accuracy of seasonal adjustments, track both seasonally adjusted and not seasonally adjusted monthly data for this indicator.

Home values affect much in the economy - especially the housing and consumer sectors. Periods of rising home values encourage new construction while periods of soft home prices can dampen housing starts. Changes in home values, and the ability to draw upon expanding lines of home equity loans, play key roles in consumer spending and in consumer financial health.

Beginning with the onset of the subprime credit crunch in mid-2007 and with it a downturn in home prices, the ability of borrowers to refinance their debt into affordable fixed rate mortgages was sharply constrained. This in turn limited aggregate consumer spending and contributed to the depth of the Great Recession. From their peak in late 2006 and early 2007 to their nadir in mid-2012, Case-Shiller's home price indexes fell nearly 50 percent. The subsequent recovery proved slow but steady with the indexes finally surpassing their prior highs in early 2018.