Home-price growth accelerated in March, even as home sales dropped after the coronavirus pandemic shut down economic activity in some regions.
The S&P CoreLogic Case-Shiller National Home Price Index, which measures average home prices in major metropolitan areas across the nation, rose 4.4% in the year that ended in March, up from a 4.2% annual rate the prior month. March marked the highest annual growth rate since December 2018.
Sales of previously owned homes, which make up the bulk of the housing market, fell 8.5% in March from the prior month as the pandemic kept buyers and sellers on the sidelines, according to the National Association of Realtors.
But a decline in home sales hasn’t corresponded with lower home prices so far this spring. Many sellers took their homes off the market once the pandemic struck or opted to wait to sell, reducing the number of available houses for sale. The stimulus bill passed in March also enabled many homeowners to suspend mortgage payments if needed, reducing the risk of foreclosures or distressed sales.
The data, which was released Tuesday, is based on transactions closed during March, which typically reflect purchase decisions made in February or January.
“Housing prices continue to be remarkably stable,” said Craig Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices, in a statement. “As much of the U.S. economy remained shuttered in April, next month’s data may show a more noticeable impact” from the pandemic.
U.S. existing-home sales dropped 17.8% in April, the biggest monthly decline since July 2010, according to NAR.
The Case-Shiller 10-city index gained 3.4% over the year ended in March, up from a 3% annual change in February. The 20-city index rose 3.9%, after an annual gain of 3.5% in February.
The 20-city index only measured 19 cities this month due to transaction reporting delays in Wayne County, Mich., according to S&P Dow Jones Indices. Price growth accelerated in 17 of the 19 cities.
Phoenix had the fastest home-price growth in the country, at 8.2%, followed by Seattle at 6.9%.
A separate measure of home-price growth by the Federal Housing Finance Agency released Tuesday found a 5.9% increase in home prices in March from a year earlier.