WASHINGTON — America’s housing market has grown so overheated as demand outpaces supply that prices keep hitting record highs — and roughly half of all U.S. houses are now selling above their list price.

Two years ago, before the pandemic struck, just a quarter of homes were selling above the sellers’ asking price, according to data from the real estate brokerage Redfin.

On Tuesday, new data further illuminated the red-hot nature of the housing market: Prices rose in March at the fastest pace in more than seven years. The S&P CoreLogic Case-Shiller 20-city home price index jumped 13.3% that month compared with a year earlier — the biggest such gain since December 2013. That price surge followed a 12% year-over-year jump in February.

Several factors are driving the seemingly relentless rise in home prices. The pandemic has encouraged more people to seek out the additional space provided by a single-family home. Yet at the…

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