By Geoffrey Smith
Investing.com -- U.S. single-family house prices kept on rising at record rates in March, shrugging off the impact of higher borrowing costs, according to fresh data released on Tuesday.
S&P Global said that average prices nationwide for single-family homes rose 20.6% on the year, an acceleration from 20.0% in February. Its composite index drawn from the 20 most important city markets suggested that prices rose even more sharply there, at an annual rate of 21.2%, compared to an upwardly-revised 20.3% in February.
Tampa, Phoenix, and Miami reported the highest year-over-year gains among the 20 cities in March, all three posting annual increases of over 30%. Tampa led the way with a 34.8% increase, followed by Phoenix (32.4%) and Miami (32.0%). Seventeen of the 20 cities reported higher price increases in the year ending March 2022 versus the year ending February 2022.
The numbers are an illustration of the 'frothy' market conditions that Federal Reserve officials have taken aim at in recent months by raising the central bank's key interest rate by three-quarters of a point. Fed Governor Chris Waller, one of the more hawkish voices on its Washington, DC-based board, said on Monday that he expects "several" further raises of a half-point each in the next few meetings, continuing until inflation makes a "substantial" decline from the 40-year high of 8.5% that it posted in March.
The figures are, however, slightly more backward-looking than other indicators from the sector. Data from the Mortgage Bankers Association shows that 30-year mortgage rates have risen by some 75 basis points since the end of March, while applications for mortgages have fallen in six of the eight weeks since then, suggesting that the market may be weakening due to affordability concerns.