S&P Dow Jones Indices (S&P DJI) reported on Tuesday its Case-Shiller Home Price Index, which tracks home prices in 20 U.S. metropolitan areas, surged 13.3 percent y-o-y in March, following a revised 12.0 percent y-o-y climb in February (originally an 11.9 percent y-o-y jump). This was the biggest annual gain in house prices since December 2013.

Economists had expected a climb of 12.3 percent y-o-y.

Phoenix (+20.2 percent y-o-y), San Diego (+19.1 percent y-o-y) and Seattle (+18.3 percent y-o-y) recorded the highest y-o-y advances among the 20 cities in March. Overall, all 20 cities reported greater price gains in the year ending March 2021 versus the year ending February 2021.

Meanwhile, the S&P/Case-Shiller U.S. National Home Price Index, which measures all nine U.S. census divisions, climbed 13.2 percent y-o-y in March, following a 12.0 percent y-o-y jump in the previous month. 

“These data are consistent with the hypothesis that COVID has encouraged potential buyers to move from urban apartments to suburban homes,” noted Craig Lazzara, Managing Director and Global Head of Index Investment Strategy at S&P DJI. “This demand may represent buyers who accelerated purchases that would have happened anyway over the next several years. Alternatively, there may have been a secular change in preferences, leading to a permanent shift in the demand curve for housing. More time and data will be required to analyze this question.”