Home Prices Up 6.5 Percent in March

This story was originally published in Builder.

The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 6.5 percent annual gain in March, the same as the previous month.

The 10-City Composite annual increase came in at 6.5 percent, up from 6.4 percent in the previous month. The 20-City Composite posted a 6.8 percent year-over-year gain, no change from the previous month.

Seattle, Las Vegas, and San Francisco continue to report the highest year-over-year gains among the 20 cities. In March, Seattle led the way with a 13.0 percent year-over-year price increase, followed by Las Vegas with a 12.4 percent increase and San Francisco with an 11.3 percent increase. Twelve of the 20 cities reported greater price increases in the year ending March 2018 versus the year ending February 2018.

Before seasonal adjustment, the National Index posted a month-over-month gain of 0.8 percent in March. The 10-City and 20-City Composites reported increases of 0.9 percent and 1.0 percent, respectively.

After seasonal adjustment, the National Index recorded a 0.4 percent month-over-month increase in March. The 10-City and 20-City Composites posted 0.4 percent and 0.5 percent month-over-month increases, respectively. All 20 cities reported increases in March before seasonal adjustment, while 19 of 20 cities reported increases after seasonal adjustment.

“The home price increases continue with the National Index rising at 6.5 percent per year,” said David M. Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices. “Seattle continues to report the fastest rising prices at 13 percent per year, double the National Index pace. While Seattle has been the city with the largest gains for 19 months, the ranking among other cities varies. Las Vegas and San Francisco saw the second and third largest annual gains of 12.4 percent and 11.3 percent. A year ago, they ranked 10th and 16th. Any doubts that real, or inflation-adjusted, home prices are climbing rapidly are eliminated by considering Chicago; the city reported the lowest 12-month gain among all cities in the index of 2.8 percent, almost a percentage point ahead of the inflation rate."

Blitzer continued, “Looking across various national statistics on sales of new or existing homes, permits for new construction, and financing terms, two figures that stand out are rapidly rising home prices and low inventories of existing homes for sale. Months-supply, which combines inventory levels and sales, is currently at 3.8 months, lower than the levels of the 1990s, before the housing boom and bust. Until inventories increase faster than sales, or the economy slows significantly, home prices are likely to continue rising. Compared to the price gains of the last boom in the early 2000s, things are calmer today. Gains in the National Index peaked at 14.5 percent in September 2005, more quickly than Seattle is rising now.”

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