Home prices climbed 10.2 percent year over year in October, the largest annual gain reported in more than 15 years, according to data released Wednesday by the Federal Housing Finance Authority (FHFA).
The massive gains in the house price index (HPI) were propelled by extremely low mortgage rates — which continue to set records seemingly every week — and a limited supply of homes for sale, according to Lynn Fisher, FHFA’s deputy director of the division of research and statistics.
“U.S. house prices rose for the fifth straight month since states re-opened their local economies,” Fisher said. “The 12-month gain of 10.2 percent in October is the highest annual appreciation observed since the 2004-2005 period.”
The data does not reflect some of the most recent lockdown orders that have been implemented locally, since the start of the latest COVID-19 wave.
Prices increased in every single region tracked by FHFA. The Mountain and New England regions saw the biggest annual gains, with prices increasing 12.5 percent year over year.
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.”