The Rise and Rise of Home Prices

U.S. home prices in February were up 0.6 percent from the previous month nationwide, according to the Federal Housing Finance Agency's latest House Price Index. Prices for sales guaranteed by Fannie Mae and Freddie Mac were up 7.2 percent compared to last February, according to this report.

The month-to-month numbers from FHFA were slightly higher than those reported in the latest S&P CoreLogic Case-Shiller Home Price Index, released on Tuesday, which said that February prices were up 0.4 percent from January; they were up 6.3 percent from a year earlier.

“Home prices continue to rise across the country,” said David Blitzer, managing director and chairman of the Index Committee at S&P Dow Jones Indices while commenting on the S&P Case-Shiller HPI. “Year-over-year prices measured by the National index have increased continuously for the past 70 months.”

That’s since May of 2012. In that time, Blitzer said, prices have averaged a growth rate of 6 percent a year.

At nearly 13 percent, Seattle saw the largest growth in the past year in major markets. Home prices were also up by double digits in Las Vegas and San Francisco on the S&P Indices. Washington, D.C., and Chicago saw the lowest growth rate over the past 12 months, each less than 3 percent.

“In San Francisco and Los Angeles, home price gains ranked much higher than what would be expected from their employment increases, indicating that California home prices continued to rise faster than might be expected,” Blitzer said. “In contrast, Miami home prices experienced some of the smaller increases despite better than average employment gains.”

Despite rising prices, Realtor.com data shows homes in these markets are going fast,” said Danielle Hale, Chief Economist at Realtor.com. “In February, time on market for the typical property in Seattle was 29 days, Las Vegas 42 days, and San Francisco 21 days vs. 83 days nationally.”

Days on market sped up seasonally in March with properties disappearing after only 23 days in Seattle, 39 days in Las Vegas, and 22 days in San Francisco, Hale said.

“Potential sellers, aware of local market conditions, are listing homes priced accordingly. Realtor.com listing prices in March were up 16 percent in Seattle, 11 percent in Las Vegas, and 6 percent in San Francisco, suggesting that high prices will continue to be the norm this spring,” she said.

According to FHFA, home price growth was uneven across different sectors of the country in February. While prices remained flat in the West North Central division, they went up 1.6 percent in the East South Central division.

Year-over-year, home prices grew in every section of the country, ranging from 4.8 percent growth in the Middle Atlantic to 10.3 percent growth in the Pacific.

FHFA also revised its previous January totals. Prices that month were up 0.9 percent from December, as opposed to the previously reported 0.8 percent.