Home prices increased in February by 19.8%, according to the S&P CoreLogic Case-Shiller national home price index. That is the third-highest reading in the index's 35-year history, up from the 19.1% annual increase in January.
The annual increase for the 10 cities came in at 18.6%, up from 17.3% in the previous month. The 20-city index was up 20.2%, up from 18.9% in the previous month.
Sun Belt cities saw the highest gains. Home price gains were recorded in Phoenix, Miami and Tampa. All 20 cities reported higher prices in the year ending February 2022.
Minneapolis, New York and Washington, D.C. had the smallest price gains.
The macroeconomic environment is evolving rapidly and may not support extraordinary home price growth for a long time. We may soon see the impact of rising mortgage rates on home prices.
Mortgage rates began rising slowly at the start of the year, but they didn't really go up until March. It doesn't show much of an impact from rates because it is a three-month average. That could happen next.
The S&P Case Shiller index shows a housing market that is experiencing a renewed sense of urgency in February, as buyers work through a small number of homes for sale in an effort to get ahead of surging mortgage rates. George Ratiu is the manager of economic research at Realtor.com.
The monthly payment for a median-priced home financed with a 30-year loan is more than double what it was a year ago.
According to the National Association of Realtors, pending sales have been falling for four months in a row, and historically prices tend to lag sales by six months. The March reading will be released on Wednesday.
As we move through the spring housing market, we are seeing signs of cooling demand. Ratiu said that many buyers are rethinking their budgets and timelines.
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