FHFA: House Prices Rise 1.0 Percent in Second Quarter; Up 5.0 Percent from Last Year

U.S. house prices rose in the second quarter of 2019, up 1.0 percent according to the Federal Housing Finance Agency (FHFA) House Price Index (HPI).  House prices rose 5.0 percent from the second quarter of 2018 to the second quarter of 2019.  FHFA’s seasonally adjusted monthly index for June was up 0.2 percent from May.

FHFA produces the nation’s only public, freely available house price indexes (HPIs) that measure changes in single-family house prices based on data that cover all 50 states and over 400 American cities and extend back to the mid-1970s.  The HPIs are built from tens of millions of home sales and offer insights about house price fluctuations at the national, census division, state, metro area, county, ZIP code, and census tract levels.  The FHFA HPIs use a fully transparent methodology based upon a weighted, repeat-sales statistical technique to analyze transaction data from Fannie Mae and Freddie Mac.  FHFA releases data and reports on a quarterly and monthly basis.  The flagship FHFA HPI uses seasonally adjusted, purchase-only data, unless otherwise noted.  Additional indexes are based on other data including refinances, FHA mortgages, and real property records.  All the indexes can be downloaded from the FHFA website. 

“House prices rose again in all states and the top 100 metro areas, but the pace of growth has slackened,” said Dr. William Doerner, FHFA Supervisory Economist.  “The majority of states and cities are experiencing slower house price gains than they did a year ago, even with constrained housing supply and extremely attractive mortgage rates. 

Significant Findings

  • House prices have risen for 32 consecutive quarters across the United States. 
  • House prices rose in all 50 states and the District of Columbia between the second quarters of 2018 and 2019.  The top five areas in annual appreciation were: 1) Idaho 11.4 percent; 2) Utah 7.7 percent; 3) Tennessee 7.2 percent; 4) Georgia 6.9 percent; and 5) Arizona 6.9 percent.  The areas showing the smallest annual appreciation were:  1) Delaware 1.2 percent; 2) Maryland 1.5 percent; 3) District of Columbia 1.8 percent; 4) Iowa 2.2 percent; and 5) New Jersey 2.7 percent. 
  • House prices rose in all 100 of the largest metropolitan areas in the U.S. over the last four quarters.  Annual price increases were greatest in Boise City, ID, where prices increased by 13.6 percent.  Prices were weakest in Oxnard-Thousand Oaks-Ventura, CA, where they increased 0.5 percent. 
  • Of the nine census divisions, the Mountain division experienced the strongest four-quarter appreciation, posting a 6.6 percent gain between the second quarters of 2018 and 2019 and a 1.3 percent increase in the second quarter of 2019.  Annual house price appreciation was weakest in the Middle Atlantic division, where prices rose by 4.0 percent between the second quarters of 2018 and 2019. 

Tables and graphs showing home price statistics for metropolitan areas, states, census divisions, and the U.S. as a whole are included on the following pages. 

Other Price Indexes

Most statistics in the quarterly HPI report reference price changes computed by FHFA’s “purchase-only” HPI.  In some cases, however, the reported statistics reference alternative price measures.  FHFA publishes—and makes available for download—three additional HPIs beyond the “purchase-only” series.  Although they use the same general methodology, the three alternatives rely on slightly different datasets as follows: 

  • “Distress-Free” house price index.  Sales of bank-owned properties and short sales are removed from the purchase-only dataset prior to estimation of the index.
  • “Expanded-Data” house price index.  Sales price information sourced from county recorder offices and from FHA-backed mortgages are added to the purchase-only data sample.  This index is used annually to adjust the maximum conforming loan limits, which dictate the dollar amount of loans that can be acquired by Fannie Mae and Freddie Mac.
  • “All-Transactions” house price index.  Appraisal values from refinance mortgages are added to the purchase-only data sample.

Data constraints preclude the production of all types of indexes for every geographic area, but multiple index types are generally available.  For individual states, for instance, three types of indexes are available.  The various indexes tend to correlate closely over the long-term, but short-term differences can be significant.  

Note 

  • The next monthly HPI report (including data through July 2019) will be released September 24, 2019 and the next quarterly HPI report (including data for the third quarter of 2019 and monthly data for September) will be released November 26, 2019.
  • Future HPI release dates for 2020 and the remainder of 2019 are available at https://www.fhfa.gov/HPI.
  • See video of FHFA HPI highlights for the second quarter featuring Dr. Doerner. 
  • Follow @FHFA on Twitter, LinkedIn, Facebook, and YouTube for more HPI news.

View the report at this link.

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