U.S. Home Prices Up Nearly One Percent in Q2
The Federal Housing Finance Agency (FHFA) has announced that U.S. house prices rose 0.8 percent in the second quarter of 2014, according to its purchase-only, seasonally adjusted House Price Index (HPI). This is the twelfth consecutive quarterly price increase in the HPI. The FHFA HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac. Compared with last year, house prices rose 5.2 percent from the second quarter of 2013 to the second quarter of 2014. FHFA’s seasonally adjusted monthly index for June was up 0.4 percent from May, marking seven consecutive monthly increases. “The extraordinary price appreciation observed over the last few spring seasons was not evident in the second quarter of this year. However, house price appreciation for the nation as a whole remained positive,” said FHFA Principal Economist Andrew Leventis. “FHFA’s data indicate that house price appreciation in the quarter was near or below the baseline rate of inflation in most states.” FHFA’s expanded-data house price index, a metric that adds transaction information from county recorder offices and the Federal Housing Administration to the HPI data sample, rose 1.3 percent over the prior quarter. Over the last year, that index is up 6.2 percent. Significant Findings ►The seasonally adjusted, purchase-only HPI rose in 40 states during the second quarter of 2014, down from 42 states and the District of Columbia during the first quarter of 2014. The top annual appreciation was in: 1) Nevada, 2) California, 3) District of Columbia, 4) North Dakota, and 5) Arizona. ►Of the nine census divisions, the Pacific division experienced the strongest increase in the second quarter, posting a 1.3 percent quarterly increase and a 9.8 percent increase since last year. House prices were weakest in the East South Central division, where prices decreased 0.1 percent from the prior quarter. ►As measured with purchase-only indexes for the 100 most populated metropolitan areas in the U.S., second quarter price increases were greatest in the Winston-Salem, N.C. Metropolitan Statistical Area (MSA) where prices increased by 4.6 percent. Prices were weakest in the Birmingham-Hoover, Ala. MSA, where they fell 4.9 percent. Positive quarterly appreciation was recorded in 74 of the 100 MSAs. ►The monthly seasonally adjusted, purchase-only index for the U.S. has increased for seven consecutive months and 23 of the last 24 months (it decreased in November 2013). ►The Pacific and Mountain census divisions—the two divisions that saw the greatest price increases last quarter—continued to decelerate.