The Case-Shiller Home Price Index, which is considered the “gold standard” for appreciation, showed home prices nationwide rose 0.4% from February to March after seasonal adjustment. This follows the 0.3% monthly gain seen in February. Home prices were also 0.7% higher when compared to March 2022, though this annual reading is a decline from the 2.1% gain reported in February.
The Federal Housing Finance Agency (FHFA) also released their House Price Index, which revealed that home prices rose 0.6% from February to March. This follows the 0.1% monthly gain reported in January and the 0.7% gain in February. Prices rose 3.6% from March 2022 to March 2023, though this was a slight decline from the 4.2% annual increase reported in February.
These figures differ in part because FHFA’s report measures home price appreciation on single-family homes with conforming loan amounts, which means it most likely represents lower-priced homes. FHFA also does not include cash buyers or jumbo loans.
What’s the bottom line? The uptick in appreciation over the last few months suggests we’re past the inflection point and home prices are on the rise again. “The modest increases in home prices we saw a month ago accelerated in March 2023,” explained S&P DJI Managing Director Craig J. Lazzara, who added that prices are now only 3.6% below their peak from June 2022. This is a far cry from the housing crash of 20% that some in the media have forecasted and shows the opportunity that remains for homebuyers to start building wealth through real estate.