Magazine article Mortgage Banking

OFHEO's HPI Shows Home-Price Increase in 2q

Magazine article Mortgage Banking

OFHEO's HPI Shows Home-Price Increase in 2q

Article excerpt

OFHEO's QUARTERLY HOUSE PRICE INDEX (HPI) shows that the average U.S. home price increased 0.78 percent in the second quarter of 2003, compared with 5.56 percent in the second quarter of 2002. On an annualized basis, the price increase for 2003 projects to 3.12 percent.

The report shows continued rising home prices, but also continued slowing in those increases. According to Sally Dreiman, a senior economist at OFHEO, mortgage interest rates and the unemployment rate are major contributors to the slowing.

"The slowing seen has been linked to the decline in the labor market, with the lowest growth since the third quarter of 1996. But housing prices are still growing at healthy rates," said Dreiman.

OFHEO's HPI is a quarterly report that analyzes average house-price changes in repeat sales or refinancings on the same single-family properties whose mortgages have been purchased or securitized by Fannie Mae or Freddie Mac, the GSEs that OFHEO regulates for safety and soundness. OFHEO's tracking data is based on nine Census Bureau divisions, the 50 states, the District of Columbia and 331 metropolitan statistical areas (MSAs).

The U.S. Census divisions ranked from highest to lowest annual percentage changes are: Pacific (7.97 percent), New England (7.79 percent), Middle Atlantic (7.03 percent), South Atlantic (6.04 percent), East South Central (3.90 percent), West North Central (3.84 percent), West South Central (3.71 percent), Mountain (3.60 percent) and East North Central (3.17 percent).

The top 15 states with the highest annual percentage house-price changes as of June 30, 2003, are: Rhode Island (11. …

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