Home prices continue to soar while slowdown fears mount
American home prices continued to skyrocket in March as buyers scrambled to lock down mortgages ahead of rising interest rates, leading industry experts said Tuesday.
But with slowdown concerns escalating, some say the latest increase could mark the crescendo of a sector that’s risen by 37% overall since the start of the COVID-19 pandemic.
“Homebuyer frenzy reached another new high, as eager buyers tried last-ditch efforts to secure a home before mortgage rates surged,” the report by the CoreLogic Case-Shiller Home Price Index said.
Home prices were up by 20% in March compared to the same period last year.
States including Florida have seen a real-estate boom, with prices in Tampa bursting by 34.8% compared to the same month last year.
Tampa unseated Phoenix, which had notched the highest price increases for 33 consecutive months.
The Arizona city has seen home values pop by an astounding 59% since the start of the pandemic, the analysis found.
Miami saw prices jump by 32% in March, followed by Dallas at 30.7% and San Diego at 29.6%.
The report found that colder weather cities saw more modest gains in recent months while the West Coast and Sun Belt continued to see sharper hikes.
Still unsteady from the impact of the pandemic, New York City saw home prices increase by 13.5% in March, the study found.
The report warned of a likely deceleration in the coming months.
“The most recent evidence on the impact of higher rates on housing demand suggests that the buyer demand is slowing, with fewer buyers competing for homes,” it stated. “Homes staying on the market for more days also reflects slowing demand.”