Federal Housing Finance Agency
26 August 2017
U.S. house prices rose 1.6 percent in the second quarter of 2017 according to the Federal Housing Finance Agency (FHFA) House Price Index (HPI). House prices rose 6.6 percent from the second quarter of 2016 to the second quarter of 2017. FHFA’s seasonally adjusted monthly index for June was up 0.1 percent from May.
The HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac.
“U.S. house prices rose in most states during the second quarter,” said FHFA Senior Economist William Doerner. “New home sales are climbing but, relative to the overall population, they still remain low from a historical perspective. The tight inventory is a major explanation for why house prices have been increasing every quarter over the last six years.”
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 house price index report reference price changes computed by FHFA’s basic “purchase-only” HPI. In some cases, however, the reported statistics reference alternative price measures. FHFA publishes – and makes available for download – three additional house price indexes beyond the basic “purchase-only” series. Although they use the same general methodology, the three alternatives rely on slightly different datasets as follows:
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.
This quarter’s HPI report includes a Technical Note describing a minor methodological adjustment to the way that FHFA’s “distress-free” indexes are estimated. The adjustment, described on pages 14-15, has a limited impact on the distress-free measures, which have been, and continue to be, developmental in nature.
FHFA’s HPI tracks changes in average home prices by analyzing changes in home values for the individual properties. The underlying “repeat-transactions” methodology constructs index estimates by statistically evaluating price appreciation (or depreciation) for homes with multiple values over time. The purchase-only HPI uses sales price information from Fannie Mae- and Freddie Mac-purchased and Enterprise-guaranteed mortgages originated over the past 42 years. The purchase-only HPI is estimated with more than eight million repeat transactions.
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