Jill Mislinski: The Federal Housing Finance Agency (FHFA) has released the U.S. House Price Index (HPI) for the most recent month. Here is the opening of the report.
U.S. house prices rose in January, up 0.5 percent on a seasonally adjusted basis from the previous month, according to the Federal Housing Finance Agency (FHFA) monthly House Price Index (HPI). The previously reported 0.4 percent increase in December was revised upward to reflect a 0.5 percent increase.
The HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac. [Link to report]
Investing.com had forecast a 0.5 percent increase.
The chart below illustrates the HPI series, which is not adjusted for inflation, along with a real (inflation-adjusted) series using the Consumer Price Index: All Items Less Shelter.
In the chart above we see that the nominal HPI index is now at its its pre-recession peak of what’s generally regarded to have been a housing bubble. Adjusted for inflation, the index remains well off its historic high.
The next chart shows the growth of the nominal and real index since the turn of the century.
For an interesting comparison, let’s overlay the HPI and the most closely matching subcomponent of the Consumer Price Index, Owners’ Equivalent Rent of Residences (OER).