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Economy in Brief

U.S. FHFA House Price Measure Increases Steadily
by Tom Moeller  February 23, 2017

The Federal Housing Finance Agency's (FHFA) index of U.S. house prices rose 6.2% during all of 2016 following a 5.7% increase in 2015, and a 5.4% gain during 2014. These increases were down somewhat from the 7.3% rise in 2013, yet improved from the deflation in 2011. During December, the index rose 0.4% after a 0.7% November gain, revised from 0.5%. The three-month annualized growth of 5.5% was down from September's firmer 7.9%.

During the twelve months ending in December, the Mountain states led the gain in home prices with an 8.5% rise, though monthly increases tapered off at year-end. The Pacific states followed last year with a 7.2% increase, though improvement has been volatile during the last few months. Strength in the South Atlantic states followed with a 7.1% rise last year. The 6.8% increase in the East South Central states reflected pronounced strengthening near year-end.

Home price inflation was somewhat more moderate in the West South Central region where a 6.2% rise in home prices was posted last year, though prices dipped in December. In the East North Central sector, home prices rose 6.0% and strengthened 0.9% at yearend. Home prices rose 5.7% y/y in the West North Central area.

Home price appreciation was weakest in the New England states, but the 4.4% rise was improved from price deflation as recently as 2012. In the Middle Atlantic states, the weakest y/y gain in home prices occurred. The 3.0% rise in 2016 was an improvement, however, from the deflation in home prices into 2012.

The FHFA house price index is a weighted repeat sales index, measuring average price changes in repeat sales of the same property. An associated quarterly index also includes refinancings on the same kinds of properties. The indexes are based on transactions involving conforming, conventional mortgages purchased or securitized by Fannie Mae or Freddie Mac. Only mortgage transactions on single-family properties are included. The FHFA data are available in Haver's USECON database.

FHFA U.S. House Price Index, Purchase Only (SA %) Dec Nov Oct Dec Y/Y 2016 2015 2014
Total 0.4 0.7 0.3 6.2 6.2 5.7 5.4
  Mountain 0.4 0.5 0.9 8.5 8.0 7.9 7.2
  Pacific 0.1 1.1 0.1 7.2 8.1 8.0 9.4
  South Atlantic 0.7 0.2 0.4 7.1 7.2 6.5 5.8
  East South Central 2.0 1.4 -0.6 6.8 5.3 4.8 3.5
  West South Central -0.1 0.5 0.1 6.2 6.1 6.4 5.6
  East North Central 0.9 0.4 0.6 6.0 5.4 4.6 4.5
  West North Central 0.3 1.0 0.0 5.7 5.6 4.3 4.1
  New England 0.2 0.4 0.9 4.4 4.0 3.6 3.1
  Middle Atlantic -1.1 1.2 0.1 3.0 3.5 2.7 2.2


New England: Maine, New Hampshire, Vermont, Massachusetts, Rhode Island and Connecticut.
Middle Atlantic: New York, New Jersey and Pennsylvania.
East North Central: Michigan, Wisconsin, Illinois, Indiana and Ohio.
West North Central: North Dakota, South Dakota, Minnesota, Nebraska, Iowa, Kansas and Missouri.
South Atlantic: Delaware, Maryland, D.C., Virginia, West Virginia, North Carolina, South Carolina, GA & FL
East South Central: Kentucky, Tennessee, Mississippi and Alabama.
West South Central: Oklahoma, Arkansas, Texas and Louisiana.
Mountain: Montana, Idaho, Wyoming, Nevada, Utah, Colorado, Arizona and New Mexico.
Pacific: Hawaii, Alaska, Washington, Oregon and California.

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