TAMPA, Fla. (WFLA) — Tampa home prices rose faster than anywhere else in the country in the past year. While the U.S. averaged a 20.6% increase in home prices overall, the Tampa metro area had a 34.8% increase year-over-year through March.
According to data analysis provided by the S&P CoreLogic Case-Shiller Index, the next closest price increase levels were in Phoenix, Ariz., where home prices had risen 32.4% over the yearlong time period ending in March 2022.
“Tampa, Phoenix, and Miami reported the highest year-over-year gains among the 20 cities in March,” S&P reported. “Tampa led the way with a 34.8% year-over-year price increase, followed by Phoenix with a 32.4% increase, and Miami with a 32.0% increase.”
Month-over-month, the S&P data showed Tampa home prices had risen 3.7% from February to March. Nationally, home prices had only risen 2.6%. Analysts who put the data together said the country may have to wait longer before markets cool down, at least another month.
“Those of us who have been anticipating a deceleration in the growth rate of U.S. home prices will have to wait at least a month longer,” Craig J. Lazzara, Managing Director at S&P DJI said. “The National Composite Index recorded a gain of 20.6% for the 12 months ended March 2022.”
Lazzara’s analysis also said that increased interest rates from the Federal Reserve, which increased mortgage levels, may not give the support needed to let home prices grow “much longer.” He said that it would be a safe prediction that price gains will start to slow down. “The timing of the deceleration is a more difficult call.”
Currently, the U.S. 30-year fixed rate mortgage has remained over 5% since the middle of April, when the Federal Reserve put interest rates up for the first time in years. Since then, the rates have fluctuated, reaching a recent high of 5.3% on May 12, before leveling out slightly, now at 5.09%, according to federally-backed mortgage company Freddie Mac.
In a release accompanying the Thursday update of national mortgage rate averages, Freddie Mac said the summer might see the number of homebuyers drop.
“Mortgage rates continued to inch downward this week but are still significantly higher than last year, affecting affordability and purchase demand,” Sam Khater, Freddie Mac’s Chief Economist said. “Heading into the summer, the potential homebuyer pool has shrunk, supply is on the rise and the housing market is normalizing. This is welcome news following unprecedented market tightness over the last couple years.”