Home prices continue to hit new highs with the latest increase in May, a slowdown from April’s increase but still up month-over-month, according to the House Price Index released by the Federal Housing Finance Agency.
Home prices increased 0.4% monthly in May, according to the seasonally adjusted monthly House Price Index. This is down from the downwardly revised increase of 0.6% in April. Year-over-year, home prices increased 6.9%.
The chart below shows home prices surpassed their previous 2012 peak in early-2016, and continued to increase, consistently hitting a new peak.
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The FHFA monthly HPI is calculated using home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac. Because of this, the selection excludes high-end homes bought with jumbo loans or cash sales.
Other measures also show increasing home prices. The latest Case-Shiller report, released Tuesday morning, also showed a home price increase of 0.2% after seasonal adjustment. However, despite these increases, SP Dow Jones Indices’ managing director explained housing is not repeating the bubble period. Here’s why.
Regionally, home price changes from April to May ranged from a drop of 0.5% in the Middle Atlantic division to a 1% increase in the West South Central division. Annually, all changes were positive, ranging from an increase of 4% in the Middle Atlantic division to an increase of 8.7% in the Pacific division.
Here is a list of which states are in each of those divisions:
Middle Atlantic: New York, New Jersey, Pennsylvania
West South Central: Oklahoma, Arkansas, Texas, Louisiana
Pacific: Hawaii, Alaska, Washington, Oregon, California