WASHINGTON (AP) — U.S. home prices rose in March, but the gains are decelerating as fewer Americans can afford to buy.
The Standard & Poor's/Case-Shiller 20-city home price index rose 12.4 percent in March compared with 12 months earlier. While healthy, that rate of growth has slowed from both February and January.
Home prices rose in 19 of the 20 cities in March compared with the previous month, with only New York registering a slight decline, Standard & Poor's reported Tuesday. Leading the gains was San Francisco with a 2.4 percent monthly increase, while prices in Seattle, another hub for technology firms, rose 1.9 percent.
The housing market has struggled in recent months, after notching strong growth in the first half of 2013.
Rising prices and higher interest rates beginning in the middle of last year made homes less affordable for would-be buyers.
Meanwhile, a limited supply of homes is available to buy. New construction has focused increasingly on rental apartments, instead of single-family homes. And 9.7 million Americans are stuck in homes worth less than their mortgage debts, making them reluctant to sell, according to the real estate data firm Zillow.
The price gains over the past 12 months were the "result of a witch's brew," said Stan Humphries, chief economist at Zillow. It was made possible by the lows of the housing bust that began in 2007, the historically low mortgage rates and a limited supply of homes on the market.
"These influences are beginning to fade, and we're already seeing a monthly slowdown in home prices in more recent data," Humphries said.