Home prices in the United States continued their upward trajectory in March, with the S&P CoreLogic Case-Shiller U.S. National Home Price Index recording a 6.5% annual gain, matching February’s growth, according to the latest report.
Meanwhile, the U.S. National Index posted a month-over-month increase of 0.3%, while the 20-City and the 10-City Composite both reported month-over-month increases of 0.3% and 0.5%, after seasonal adjustment.
“This month’s report boasts another all-time high,” Brian Luke, head of commodities, real and digital assets at S&P Dow Jones Indices, said in a statement. “We’ve witnessed records repeatedly break in both stock and housing markets over the past year. Our National Index has reached new highs in six of the last 12 months. During that time, we’ve seen record stock market performance, with the S&P 500 hitting fresh all-time highs for 35 trading days in the past year.”
March’s index data tracks home sales in January, February, and March, a period in which mortgage rates hovered in the 6.6%-6.9% range. Home inventory increased by 23.5% in March but remained nearly 40% below pre-pandemic levels. Existing home sales, however, decreased by 4.3% in March following a significant gain in February.
“Given the surge in mortgage rates between the end of March and the beginning of May, we expect both home price growth, inventory, and home sales to moderate in future housing market data releases,” Realtor.com Senior Economist Ralph McLaughlin said in a statement.
The Case-Shiller index measures repeat sales data and reflects a three-month moving average.
Northeast leads the way
The Northeast posted the strongest annual price gains, with an 8.3% increase, demonstrating robust growth compared to other regions. In contrast, Southern cities like Tampa, Phoenix, and Dallas, which excelled in 2020 and 2021, are now growing at a slower pace.
“On a seasonal adjusted basis, national home prices have reached their ninth all-time high within the past year, with all 20 metropolitan markets posting positive annual gains for the fourth consecutive month, indicating widespread and sustained growth in the housing sector,” Luke said.
San Diego led the year-over-year price gains with an impressive 11.1% increase, followed closely by New York, Cleveland, and Los Angeles. Urban markets continue to show strong demand, with the two largest population centers contributing about 30% of the 20-City Composite and demonstrating significant recovery.
These areas have kept pace with the national composite annualized return of 9.9% since 2020. While Southern California ranked among the best annually, Seattle and San Francisco recorded the strongest monthly gains, according to Luke.
Jason Waugh, president of Coldwell Banker Affiliates, told HousingWire that mortgage rate volatility has emerged as a significant hurdle for homebuyers, alongside the structural lack of inventory. Toward the end of 2023, mortgage rates experienced a notable decline over nine consecutive weeks, only to climb again for five straight weeks this spring.
”I think that sort of volatility impacts decision making,” Waugh said. ”If rates had just stayed flat for a period of time, people would have adjusted and adapted. I think the volatility in either direction has been a contributing factor as it leads to uncertainty, and nobody likes uncertainty and volatility.”
This report was updated with information from Coldwell Banker Affiliates.
