Thursday, April 22, 2010

FHFA House Price Index Declines in February

by Bill McBride on 4/22/2010 03:57:00 PM

The two house price indexes I usually use are from S&P Case-Shiller and First American Corelogic LoanPerformance (the one the Fed uses). The FHFA index is also a repeat sales index, but only includes GSE loans - and it has other issues too.

The LoanPerformance and Case-Shiller indexes for February will be released soon, but here is the FHFA index (and a graph of all three).

From Federal Housing Finance Agency (FHFA): U.S. Monthly House Price Index Declines 0.2 Percent from January to February

U.S. house prices fell 0.2 percent on a seasonally adjusted basis from January to February, according to the Federal Housing Finance Agency’s monthly House Price Index. The previously reported 0.6 percent decline in January was unchanged. For the 12 months ending in February, U.S. prices fell 3.4 percent. The U.S. index is 13.3 percent below its April 2007 peak.

The FHFA monthly index is calculated using purchase prices of houses backing mortgages that have been sold to or guaranteed by Fannie Mae or Freddie Mac.
House Prices Indexes Click on graph for larger image in new window.

This graph shows the three indexes (note that LoanPeformance is NSA, Case-Shiller and FHFA are seasonally adjusted). FHFA is set to 100 in Jan 2000. The insert shows the movement of the three indexes since Jan 2008.

The FHFA index didn't match what we were seeing during the housing bubble, and I just wanted to point out why I focus on the other indexes now.