U.S. home prices in March climbed 3.4% year over year, a slight decrease from February’s 4.1% gain. At the same time, month-over-month home price growth accelerated to 0.8% in March from 0.4% in February, according to S&P CoreLogic Case-Shiller U.S. National Home Price Index data released Tuesday.
These conflicting data points suggest that a seasonal housing recovery is underway, according to Nicholas Godec, head of fixed income tradables and commodities at S&P Dow Jones Indices.
“Home price growth continued to decelerate on an annual basis in March, even as the market experienced its strongest monthly gains so far in 2025,” Godec observed in a press release. “This divergence between slowing year-over-year appreciation and renewed spring momentum highlighted how the housing market shifted from mere resilience to a broader seasonal recovery.”
The Case-Shiller index, which measures the prices of repeat sales of single-family U.S. homes, is supplemented by indexes that track home prices in the top 10 and 20 largest metropolitan areas. In March, the 10-city composite index posted a 4.8% year-over-year increase, down from 5.2% in February. The 20-city composite saw a 4.1% increase compared to March 2024, down from a 4.5% yearly increase the prior month.
Godec noted that 18 of the top 20 metro areas experienced non-seasonally adjusted price gains in March, underscoring a continued affordability crunch for prospective homebuyers.
“Looking at the market environment, affordability remained severely constrained, though it did not worsen materially in early 2025 as borrowing costs stabilized,” Godec said. “Mortgage rates hovered in the mid-6% range throughout March, keeping monthly payment burdens near multi-decade highs relative to incomes. This continued to weigh on buyer demand, but persistent supply shortages helped counteract the headwinds.”
Another housing report released Tuesday by the Federal Housing Finance Agency (FHFA) found that single-family home prices increased 4% between the first quarter of 2024 and the same quarter of 2025. Compared to the fourth quarter of 2024, first-quarter home prices were up 0.7%, while the FHFA’s seasonally adjusted house price index was down 0.1% in March compared to February.
The FHFA report noted that house prices increased in 49 states and the District of Columbia between the first quarter of 2024 and the first quarter of 2025. Rhode Island had the largest year-over-year increase at 11.4%, followed by West Virginia at 9.3%, Connecticut at 9% and Ohio at 7.6%. Hawaii saw house prices fall 2.2% during that period, according to FHFA data.
