Global| Oct 27 2020U.S. FHFA House Price Index Posts Record Monthly Increase
by:Sandy Batten
|in:Economy in Brief
Summary
• FHFA home price index jumped up 1.5% m/m, a record dating back to 1991. • Prices up 8.0% y/y, the fastest annual pace of increase since 2006. • Significant monthly price gains across the country. The Federal Housing Finance Agency [...]
• FHFA home price index jumped up 1.5% m/m, a record dating back to 1991.
• Prices up 8.0% y/y, the fastest annual pace of increase since 2006.
• Significant monthly price gains across the country.
The Federal Housing Finance Agency (FHFA) Price Index jumped up a much larger-than-expected 1.5% m/m in August following an upwardly revised 1.1% m/m rise in July (initially 1.0%). The August rise was the largest monthly increase in the series which dates back to January 1991. Over the past year, house prices have increased 8.0%, the fastest annual pace of increase since March 2006. In the last three months, prices have risen 3.7% as housing demand has rebounded, mortgage interest rates have fallen to nearly unbelievable levels and supply has been constrained.
Home prices increased in each of the nine census divisions and in most regions the pace of increase also rose. Price gains were strongest in the West South Central region, up 1.9% m/m (7.3% y/y), a record monthly increase. Gains were also strong in New England (1.8% m/m, 8.1% y/y), the Middle Atlantic (+1.8% m/m, 7.4% y/y) and the Mountain region (1.7% m/m, 9.7% y/y). The weakest monthly gain was in the East South Central region (0.9% m/m, 8.8% y/y), the only region to past less than a 1% monthly increase.
The FHFA house price index is a weighted purchase-only index that measures average price changes in repeat sales of the same property. An associated quarterly index 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 %) |
Aug | Jul | Jun | Aug Y/Y | 2019 | 2018 | 2017 |
|---|---|---|---|---|---|---|---|
| Total | 1.5 | 1.1 | 1.0 | 8.0 | 5.3 | 6.5 | 6.3 |
| New England | 1.8 | 1.9 | 1.3 | 8.1 | 4.6 | 5.1 | 5.6 |
| Middle Atlantic | 1.8 | 1.3 | 0.4 | 7.4 | 4.5 | 5.3 | 4.7 |
| East North Central | 1.3 | 1.4 | 0.9 | 7.8 | 5.4 | 6.4 | 5.8 |
| West North Central | 1.4 | 0.7 | 0.7 | 7.2 | 5.1 | 6.0 | 5.1 |
| South Atlantic | 1.4 | 0.9 | 1.0 | 8.6 | 5.7 | 7.0 | 6.5 |
| East South Central | 0.9 | 1.1 | 1.3 | 8.8 | 5.9 | 6.0 | 5.5 |
| West South Central | 1.9 | 0.7 | 1.2 | 7.3 | 4.7 | 5.2 | 6.0 |
| Mountain | 1.7 | 1.2 | 1.5 | 9.7 | 7.1 | 9.0 | 8.3 |
| Pacific | 1.5 | 1.1 | 1.4 | 7.9 | 4.7 | 7.3 | 8.4 |
Sandy Batten
AuthorMore in Author Profile »Sandy Batten has more than 30 years of experience analyzing industrial economies and financial markets and a wide range of experience across the financial services sector, government, and academia. Before joining Haver Analytics, Sandy was a Vice President and Senior Economist at Citibank; Senior Credit Market Analyst at CDC Investment Management, Managing Director at Bear Stearns, and Executive Director at JPMorgan. In 2008, Sandy was named the most accurate US forecaster by the National Association for Business Economics. He is a member of the New York Forecasters Club, NABE, and the American Economic Association. Prior to his time in the financial services sector, Sandy was a Research Officer at the Federal Reserve Bank of St. Louis, Senior Staff Economist on the President’s Council of Economic Advisors, Deputy Assistant Secretary for Economic Policy at the US Treasury, and Economist at the International Monetary Fund. Sandy has taught economics at St. Louis University, Denison University, and Muskingun College. He has published numerous peer-reviewed articles in a wide range of academic publications. He has a B.A. in economics from the University of Richmond and a M.A. and Ph.D. in economics from The Ohio State University.
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