The COVID home price boom isn't going bust

The pandemic's home price boom shows no signs of turning to bust.

The big picture: Fresh housing data out Tuesday showed that prices for houses are stabilizing, pretty much around the elevated levels where they've been for the last year and a half.

State of play: The national house price index produced monthly by the Federal Housing Finance Agency shows prices were up 0.6% in April, compared with the prior month. And they're 3.7% higher than a year ago.

• Separately, the S&P Case-Shiller monthly index of home prices in 20 large cities showed a slight decline (1.1%) compared with last year. But last year’s dip seems to have leveled off — prices were up 0.5% in March compared with February.
• Relative to prices in late 2019 — before COVID — nationwide home prices were roughly 40% higher in April, according to FHFA.

Between the lines: In theory, the giant rate hikes the Fed delivered last year — mortgage rates jumped from under 3% to over 7% — might have been expected to soften the housing market.

• And it did seem to halt a juggernaut home price surge.
• But the higher financing costs have also curtailed sales since sellers don't want to let go of their cheap mortgages. There aren't that many homes on the market, and that's keeping prices from actually falling much.

The bottom line: The housing market seems to have sunk into a kind of high-price, low-sales stasis.