US Single-Family Home Prices Increase Month-Over-Month and Year-Over-Year in March

On Tuesday, Redfin reported that according to its Home Price Index (RHPI), which uses the repeat-sales pricing method to calculate seasonally adjusted changes in prices of single-family homes, US home prices climbed 0.6% month-over-month, repeating February’s gain. On a yearly basis, prices increased 7.3%, little changed from the prior month’s annual increase of 7%.

Price growth may continue to stagnate in the coming months as mortgage rates stay high. The Federal Reserve recently warned that elevated inflation will probably delay the interest-rate cuts they had been planning this year, Redfin said.

Commenting on the results of the RHPI report, Redfin Senior Economist Sheharyar Bokhari said:

“Elevated mortgage rates are putting a cap on home price growth. Sellers can’t jack up prices like they did during the pandemic because buyer budgets are already constrained by 7% interest rates. But while price growth is leveling off, prices remain at historic highs. That’s because a shortage of homes for sale—largely driven by the mortgage-rate lock-in effect—is buoying prices.”

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