Home prices rose another 1.0 percent in July, bringing the year-over-year
gain to 6.5 percent according to the House Price Index (HPI) produced by the
Federal Housing Finance Agency (FHFA). The agency also revised its previously
reported 0.9 percent price change for June 2020 to 1.0 percent.
All nine of the census divisions posted both month-over-month and annual
price gains. Monthly changes ranged from an 0.6 percent increase in the West
North Central division to 2.0 percent in New England. The 12-month changes were
lowest in the West South Central division at 5.4 percent and the Mountain and the East South Central
divisions tied for first place with increases of 7.7 percent.
“U.S. house prices posted a strong increase in July,” said Dr. Lynn
Fisher, FHFA’s Deputy Director of the Division of Research and Statistics. “Between
May and July 2020, national prices increased by over 2 percent, which
represents the largest two-month price increase observed since the start of the
index in 1991. The dramatic increase in prices this summer can be
attributed to the historically low interest rate environment and rebounding
housing demand even as the supply of homes for sale remains constrained.”
The FHFA HPI is based on purchase mortgages securitized or acquired by the
government sponsored enterprises Freddie Mac and Fannie Mae. The index was
benchmarked at 100 in January 1991 and was at 293.0 at the end of July.