Home Prices Still Grew in March As the Pandemic Took Root
Home prices in the Dallas area and nationwide saw moderate increases in March, the first month that brought significant impact from the pandemic. Dallas-area home prices rose 2.8% from a year ago and nationwide prices were 4.4% higher in the closely watched S&P CoreLogic Case-Shiller home price index. The year-over-year Dallas home price gain was one of the smallest in eight years.
"March’s data witnessed the first impact of the COVID-19 pandemic,” S&P’s Craig J. Lazzara said in the report. “That said, housing prices continue to be remarkably stable. Housing prices have not yet registered any adverse effects from the governmental suppression of economic activity in response to the COVID-19 pandemic,” he said. “As much of the U.S. economy remained shuttered in April, next month’s data may show a more noticeable impact.”
The Dallas area had one of the smallest annual home price gains of the 19 major U.S. markets included in the monthly Case-Shiller survey. Phoenix had the biggest increase with an 8.2% rise in home prices from March 2019. Home prices were up 6.9% in Seattle and 5.8% in Charlotte.
The rate of home price growth in Dallas and most major U.S. cities has slowed in the last year but has remained positive. But home prices remain at record levels. Dallas prices have risen more than 70% since the worst of the Great Recession.
With the pandemic, home sales around the country and in North Texas have slowed. And fewer homes are on the market.
“While the pandemic has introduced a lot of uncertainty about the economic outlook, the strong demand leading up the pandemic suggests there are many buyers who are still looking to buy a home but are waiting for the economy to open up,” Selma Hepp, CoreLogic’s deputy chief economist, said in an email. “Certainly, recent data suggests home buying activity picking up, which amid low for-sale inventory levels will continue to prop up home prices.”
With millions of Americans losing their jobs because of the virus, housing analysts warn that it might take several months to gauge the impact on the home market.
“That said, relative to the broader economy, the housing market — particularly home prices — have gotten away more or less scot-free so far,” Zillow economist Matthew Speakman said. “Still, so much remains uncertain — including the longer-term path for home prices — but for now, competition for homes is holding strong and keeping prices afloat...”