House prices rose in March when interest rates also rose: S&P Case-Shiller

A sold sign is sitting outside a house.

Adam Jefferey | CNBC

Rising mortgage rates did not slow rising house prices in March.

Nationally, house prices were 20.6% higher than in March 2021, according to the S&P CoreLogic Case-Shiller Home Price Index. That is higher than the profit of 20% in February. The index is a three-month moving average ending in March.

The average rate on the 30-year fixed mortgage stood at 3.29% in early January and 4.67% at the end of March, according to Mortgage News Daily.

Case-Shiller’s combined 10 cities grew 19.5% annually in March, up from 18.7% in February. The combined 20-city saw a 21.2% year-on-year gain, up from 20.3% in the previous month. For both national and 20-city composites, the March reading was the highest year-on-year price change in more than 35 years on data.

Regionally, Phoenix slipped from the top winner spot for the first time in three years, with Tampa taking over. Tampa, Phoenix and Miami continued to show the highest annual gains, with increases of 34.8%, 32.4% and 32.0%, respectively. Seventeen of the 20 cities reported higher price increases in the year ending March 2022 compared to the year ending February 2022.

“Those of us who have expected a slowdown in U.S. house price growth will have to wait at least a month longer,” said Craig Lazzara, chief executive officer at S&P DJI. “All 20 cities saw double-digit price increases for the 12 months ended in March, and price growth in 17 cities accelerated relative to the February report.”

Cities that saw the smallest price gains, although still in double digits a year ago, were Minneapolis (+ 12.4%), Washington (+ 12.9%) and Chicago (+ 13%).

The expectation is that prices will start to fall, as home sales have been falling for several months now. However, the demand is still high, and real estate developers report that they are still seeing multiple offers for homes that are well priced. More supply is also coming to the market as sellers worry that they will miss the last days of the hot market.

“Mortgages are becoming more expensive as the Federal Reserve began to raise interest rates, suggesting that the macroeconomic environment may not be able to support extraordinary growth in house prices for much longer. The delay is a tougher call,” Lazzara added.


Notice: ob_end_flush(): failed to send buffer of zlib output compression (0) in /home/rvpgmedi/public_html/wp-includes/functions.php on line 5275