Home prices continued their steep rise in July, according to data released Wednesday by the Federal Housing Finance Agency House (FHFA). The FHFA’s home price index (HPI) increased 6.5 percent year over year and 1 percent month over month, with annual gains in every census division.
FHFA also revised its June data upward, to show national prices increasing by 1 percent month-over-month, rather than 0.9 percent.
“U.S. house prices posted a strong increase in July,” Lynn Fisher, FHFA’s deputy director of the division of research and statistics, said in a statement. “Between May and July 2020, national prices increased by over 2 percent, which represents the largest two-month price increase observed since the start of the index in 1991.”
“The dramatic increase in prices this summer can be attributed to the historically low-interest rate environment and rebounding housing demand even as the supply of homes for sale remains constrained.”
The HPI, according to the FHFA, is, “a weighted, repeat-sales index, meaning that it measures average price changes in repeat sales or refinancings on the same properties. This information is obtained by reviewing repeat mortgage transactions on single-family properties whose mortgages have been purchased or securitized by Fannie Mae or Freddie Mac since January 1975.”