Home Prices Overtaking Pre-Crash Peak

Home prices nationally are now within 3 percent of the peak they reached in March 2007.  The Federal Housing Finance Agency (FHFA) released its purchase only Home Price Index (HPI) for February showing that home prices increased 0.7 percent on a seasonally adjusted basis compared to January and were 5.4 percent higher than in February 2014.  The increase brought home prices back to January 2006 levels and within 2.7 percent of the pre-crash peak.

The numerical index number in February was 220.5 compared to 219.0 in January and 209.2 in February 2014.  The index is calculated using home sales price information from mortgages sold to or guaranteed by the government sponsored enterprises (GSEs) Fannie Mae and Freddie Mac.  The basis for the index is January 1991=100.

The seasonally adjusted  monthly increase ranged across the nine census divisions from -1.3 percent in the East South Central Division (Kentucky, Tennessee, Mississippi, Alabama) to +1.8 percent in the South Atlantic division (all East Coast states from Delaware to Florida).  All regions posted positive changes for the 12-month period ending in February.  The smallest increase was in the Middle Atlantic division (New York, New Jersey, Pennsylvania) at 2.6 percent, the largest, at 6.9 percent was in the Pacific Division (West Coast states plus Alaska and Hawaii.)  

The February index was at its lowest, 186.3, in the East North Central division (Michigan, Wisconsin, Illinois, Indiana, Ohio) and highest in the Mountain division (Montana, Idaho, Wyoming, Nevada, Utah, Colorado, Arizona, New Mexico) at 278.1.