As the Spring sales season approaches, March housing prices continued to grow over the past 12 months, according to the S&P/Case-Shiller Home Price Indices, released Tuesday morning.

"Home prices are continuing to rise at a 5% annual rate, a pace that has held since the start of 2015," said David M. Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices, in a statement. “The economy is supporting the price increases with improving labor markets, falling unemployment rates and extremely low mortgage rates."

The national index, covering all nine census divisions, posted a 5.2% gain compared to March 2015, while the 20-City Composite and 10-City Composite remained posted a year-over-year increase of 5.4% and 4.7%, respectively. Not seasonally adjusted, all three portions of the index edged up from February levels. After seasonal adjustment, the National Composite went up by a scant 0.1% month-over-month, while 10-City Composite and 20-city Composite gained 0.8% and 0.9%, respectively. Six out of all 20 cities saw strong gains in home prices from February to March.

Another factor behind rising home prices, according to Blitzer, is the limited supply of homes on the market. "The number of homes currently on the market is less than two percent of the number of households in the U.S., the lowest percentage seen since the mid- 1980s," noted Blitzer.

Among all census regions, the Pacific Northwest and the West continue to be the strongest, with Seattle, Wash., Portland, Ore., and Denver, Colo. leading in yearly price increases. The Northeast and Upper Mid-West regions, however, were at the other end of the ranking. The four cities with the smallest year-over-year prices gains were Washington DC, Chicago, New York, and Cleveland.

Cities with the largest year-over-year price gains are:

  • Portland, Ore.: up 12.3% Y-O-Y,
  • Seattle, Wash.: up 10.8% Y-O-Y,
  • Denver, Colo.: up 10.0% Y-O-Y.

Read the full release from S&P Dow Jones Indices here >>