Home Price Gains Decline by 50% From Previous Month

Home price increases slowed appreciably in August.  The Federal Housing Finance Agency (FHFA) said its House Price Index (HPI) was up 4.6 percent on an annual basis in August compared to a 5.0 percent annual gain in July and the month-over-month gain was halved compared to the prior month, coming in at 0.2 percent.

The New England region posted the highest monthly increase at 0.9 percent, but changes were negative in three census divisions. There was an 0.8 percent decline in the East South Central division (Kentucky Tennessee, Mississippi, and Alabama) and prices were down 0.1 percent in both the South Atlantic (coastal states from Delaware to Florida) and the Mountain division.  The eight states in the Mountain division (Arizona and New Mexico north to Idaho and Montana) however, had the largest annual increase at 6.5 percent.  The smallest 12-month change, 3.9 percent, was in the Middle Atlantic (New York, New Jersey, Pennsylvania.)

FHFA's HPI is based on the sale prices of homes financed through loans purchased or guaranteed by the GSEs Fannie Mae and Freddie Mac.  The index was benchmarked at 100 in January 1991.  The August 2019 reading was 277.4.