The average price for a U.S. home increased 13.4 percent from the second quarter of 2004 through the second quarter of 2005, the Office of Federal Housing Enterprise Oversight, or OFHEO, announced Thursday.

The new data represent the largest four-quarter increase since the second quarter of 1979, according to OFHEO’s House Price Index.

According to the report, average home prices increased 3.2 percent during the April-to-June period alone, or an annualized rate of 12.8 percent.

The report said the Pacific Census Division continues to exhibit the fastest appreciation, while the slowest-growing area continues to be the West South Central division, which includes Texas, Oklahoma, Arkansas and Louisiana. Arizona and Nevada continue to exhibit striking appreciation rates.

Significant findings in the HPI:

  • Nevada continues to have the highest appreciation of all states; house prices increased 28.1 percent over the past year and 5.5 percent for the quarter. However, for the first time since the fourth quarter of 2003, Las Vegas is not on the OFHEO list of the 20 fastest-growing Metropolitan Statistical Areas (MSAs).

  • The second-greatest annual price growth was in Arizona. Over the second quarter alone, Arizona house prices grew 9.7 percent – far surpassing every other state. Arizona’s annual growth rate rose from 20.4 percent in the first quarter of 2005 to 27.8 percent in the second quarter of this year.

  • Thirty of the 265 ranked MSAs had four-quarter appreciation exceeding 25 percent.

  • For the first time, Naples-Marco Island, Fla., topped the list of ranked MSAs with the highest appreciation. Bakersfield, Calif., was second.

  • Florida, California, Nevada and Arizona are no longer the only states represented in the top 20 MSA list. MSAs in Idaho and Utah have now entered the list.

  • Twenty-five states (including the District of Columbia) exhibited double-digit annual price growth, and eight states had price increases exceeding 20 percent.

  • Four-quarter appreciation rates in Maryland and Virginia (along with Arizona and Florida) were at their highest levels over the 30-year history of the OFHEO HPI.

“There is no evidence here of prices topping out,” said OFHEO Chief Economist Patrick Lawler. “On the contrary, house-price inflation continues to accelerate, as some areas that have experienced relatively slow appreciation are picking up steam.

“However, (the price gains) are likely unsustainable given the underlying inflation rate, income growth and other factors,” Lawler said.

OFHEO’s House Price Index is published on a quarterly basis and tracks average house-price changes in repeat sales or refinancings of the same single-family properties.

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