Home-price growth climbed in March to the highest level in more than 15 years, as strong demand continued to outweigh the housing supply.

The S&P CoreLogic Case-Shiller National Home Price Index, which measures average home prices in major metropolitan areas across the nation, rose 13.2{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436} in the year that ended in March, up from a 12{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436} annual rate the prior month. March marked the highest annual rate of price growth since December 2005.

Robust homebuying demand, driven by ultralow mortgage interest rates, and a shortage of homes for sale have pushed prices rapidly higher in recent months. There were 1.07 million homes on the market at the end of March, down 28.2{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436} from a year earlier, according to the National Association of Realtors.

There are early indications that home sales are slowing, but economists expect the supply-demand imbalance to continue driving prices up. Fast-rising home prices and the limited inventory are making homeownership less attainable for first-time buyers or those with limited budgets.

Sales of newly built homes fell 5.9{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436} in April from March to a seasonally adjusted annual rate of 863,000, the Commerce Department said Tuesday.


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The Case-Shiller 10-city index gained 12.8{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436} over the year ended in March, compared with a 11.7{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436} increase in February. The 20-city index rose 13.3{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436}, after an annual gain of 12{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436} in February. Price growth accelerated in all 20 cities.

“With demand in high gear and no respite in sight, home-price growth is likely to remain in double digits over the coming quarter,” said

Selma Hepp,

deputy chief economist for CoreLogic.

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Economists surveyed by The Wall Street Journal expected the 20-city index to gain 12.4{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436}.

Phoenix had the fastest home-price growth in the country for the 22nd straight month, at 20{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436}, followed by San Diego at 19.1{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436}.

A separate measure of home-price growth by the Federal Housing Finance Agency also released Tuesday found a 13.9{960021229dc1dc07dce4932a9ddab0b26243ff9ca1f758a9c1fcae84a7a57436} increase in home prices in March from a year earlier, a record in data going back to 1991.

Americans on the Move

More WSJ coverage on the rising demand for houses, selected by the editors.

Write to Nicole Friedman at [email protected]

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