Thursday, November 14, 2013

FNC: House prices increased 6.2% year-over-year in September

by Bill McBride on 11/14/2013 02:48:00 PM

In addition to Case-Shiller, CoreLogic, FHFA and LPS, I'm also watching the FNC, Zillow and several other house price indexes.

From FNC: FNC Index: Home Prices Show Fastest Quarterly Growth Since Recovery Began

TThe latest FNC Residential Price Index™ (RPI) shows strong growth of home prices during the third quarter of 2013 as the housing recovery continues to broaden across the country. The index, constructed to gauge the price movement among the underlying non-distressed home sales, increased 2.5% between the second and third quarters, making the third-quarter growth the fastest in the current recovery.

Rising home sales and relatively low foreclosure sales are the key drivers of continued increases in home prices. As of September, foreclosure sales nationwide accounted for 13.4% of total home sales, up slightly from August’s 12.7% but down from 16.6% a year ago. Home prices are expected to grow at a more moderate pace in the coming months because housing demand tapers off in the winter. ...

Based on recorded sales of non-distressed properties (existing and new homes) in the 100 largest metropolitan areas, the FNC 100-MSA composite index shows that September home prices increased from the previous month at a seasonally unadjusted rate of 0.5%. In a sign of moderating month-over-month price momentum, September’s price increase has tapered off compared to July and August. On a year-over-year basis, home prices were up a modest 6.2% from a year ago, or 5.7% if measured quarterly. The 30-MSA and 10-MSA composites exhibit similar month-over-month price momentum but faster accelerations in year-over-year growth at 6.7% and 6.8%, respectively.
emphasis added
The 100-MSA composite was up 6.2% compared to September 2012 (slightly higher YoY change than in July and August). The FNC index turned positive on a year-over-year basis in July, 2012.

FNC House Price IndexClick on graph for larger image.

This graph shows the year-over-year change for the FNC Composite 10, 20, 30 and 100 indexes. 

Even with the recent increase, the FNC composite 100 index is still off 25.4% from the peak.

I expect all of the housing price indexes to show lower year-over-year price gains soon.