‘Higher-for-Longer’ Cools House Price Appreciation, According to First American Data & Analytics Monthly Home Price Index Report
—Expect year-over-year price appreciation to follow this cooling trend in the months to come, says Chief Economist
April1 National House Price Index
First American Data & Analytics’ National Non-Seasonally Adjusted (NSA) HPI |
|
Metric |
Change in HPI |
March- |
+0.5 percent |
April 2023-April 2024 (year over year) |
+6.1 percent |
Highlights
-
House prices nationally are now 53 percent higher compared to pre-pandemic levels (
February 2020 ). -
House price growth reported in last month’s HPI for
February 2024 toMarch 2024 was revised up 0.1 percentage points, from 0.9 percent to 1.0 percent.
Chief Economist Analysis:
“After years of historically low levels of homes for sale, the pace of existing-home listings has modestly increased, bringing much-needed supply to the housing market. However, just as inventory levels have increased, affordability has weakened as mortgage rates have drifted higher in response to the Fed’s decision to keep the federal funds rate ‘higher for longer,’ reducing demand,” said
The First American Data & Analytics HPI segments home price changes at the metropolitan level into three price tiers based on local market sales data: starter tier, which represents home sales prices at the bottom third of the market price distribution; mid-tier, which represents home sales prices in the middle third of the market price distribution; and the luxury tier, which represents home sales prices in the top third of the market price distribution.
“Nationally, price appreciation for starter homes continues to outperform other price tiers. Given starter homes are the least supplied and the most demanded segment of the market, it’s no surprise that, even in a ‘higher-for-longer’ rate environment, there are markets with double-digit annualized price appreciation," said Fleming. “Starter-tier prices are increasing year over year by more than 10 percent in
Core-Based Statistical Areas (CBSAs) Ranked by Greatest Year-Over-Year Increases in Starter Tier HPI |
|||
CBSA |
Change in Starter Tier HPI |
Change in Mid-Tier HPI |
Change in Luxury Tier HPI |
|
+12.1 percent |
+6.1 percent |
+4.1 percent |
|
+11.6 percent |
+9.7 percent |
+8.9 percent |
|
+10.8 percent |
+4.1 percent |
+3.5 percent |
|
+9.9 percent |
+7.4 percent |
+1.1 percent |
|
+9.6 percent |
+5.6 percent |
+7.9 percent |
Additional
Core-Based Statistical Areas (CBSAs) with Greatest Year-Over-Year Increases in HPI |
|
CBSA |
Change in HPI |
|
+10.2 percent |
|
+9.5 percent |
|
+8.0 percent |
|
+7.6 percent |
|
+7.6 percent |
There were no CBSAs with a Year-Over-Year Decrease in HPI |
HPI data for all 50 states and the largest 30 CBSAs by population is available here.
Next Release
The next release of the First American Data & Analytics House Price Index will take place the week of
First American Data & Analytics HPI Methodology
The First American Data & Analytics HPI report measures single-family home prices, including distressed sales, with indices updated monthly beginning in 1980 through the month of the current report. HPI data is provided at the national, state and CBSA levels and includes preliminary index estimates for the month prior to the report (i.e. the preliminary result of July transactions is reported in August). The most recent index results are subject to revision as data from more transactions become available.
The HPI uses a repeat-sales methodology, which measures prices changes for the same property over time using more than 46 million paired transactions to generate the indices. In non-disclosure states, the HPI utilizes a combination of public sales records, MLS sold and active listings, and appraisal data to estimate house prices. This comprehensive approach is particularly effective in areas where there is limited availability of accurate sale prices, such as non-disclosure states. Property type, price and location data are used to create more refined market segment indices. Real Estate-Owned transactions are not included.
Disclaimer
Opinions, estimates, forecasts and other views contained in this page are those of First American’s Chief Economist, do not necessarily represent the views of First American or its management, should not be construed as indicating First American’s business prospects or expected results, and are subject to change without notice. Although the First American Economics team attempts to provide reliable, useful information, it does not guarantee that the information is accurate, current or suitable for any particular purpose. © 2024 by First American. Information from this page may be used with proper attribution.
About First American Data & Analytics
First American Data & Analytics, a division of
About First American
1 The most recent index results are subject to revision as data from more transactions become available.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240521637130/en/
Media Contact:
Corporate Communications
(714) 250-3298
Investor Contact:
Investor Relations
(714) 250-5214
Source: First American Data & Analytics