Federal Housing Finance Agency
Contents
Federal Housing Finance Agency
The FHFA House Price Index (FHFA HPI) is a comprehensive set of indexes that measures changes in single-family home values in the United States. It's published by the Federal Housing Finance Agency (FHFA) and is a widely-used indicator of the health of the housing market.
How it Works
The FHFA HPI is a "weighted, repeat-sales index." This means it measures average price changes based on repeat sales or refinancings of the same properties over time. This methodology helps to control for differences in the quality of houses sold and provides a more accurate picture of appreciation.
The data used to calculate the HPI comes from tens of millions of mortgage transactions on single-family properties whose mortgages have been purchased or securitized by Fannie Mae or Freddie Mac since the mid-1970s. It excludes properties with government-insured loans (like FHA or VA mortgages) and those with mortgages exceeding the conforming loan limit.
What the HPI Provides
The FHFA HPI provides insights into house price fluctuations at various geographic levels, including:
| • | National: Overall U.S. house price trends. |
| • | Census Divisions: Data for the nine U.S. census divisions. |
| • | State: Information for all 50 states and the District of Columbia. |
| • | Metropolitan Statistical Areas (MSAs), counties, ZIP codes, and census tracts: Detailed data for specific local markets. |
The FHFA releases both monthly and quarterly HPI reports. The flagship index uses seasonally adjusted, purchase-only data, but other indexes are also available that include refinancings and other data sources.
Uses of the HPI
The HPI is a valuable tool for a variety of users:
| • | Economists and Policymakers: It's a key economic indicator for understanding house price trends, which can be used to estimate changes in mortgage defaults, prepayments, and housing affordability. |
| • | Homebuyers and Sellers: It can help people understand local market trends, informing decisions about when to buy or sell and what a realistic price might be. |
| • | Real Estate Professionals and Investors: It's used to analyze market performance and identify potential investment opportunities. |