Last week, the Case-Shiller Home Price Index was released for the month of January. Even though there is a two-month lag in their data, it showed that homes across the nation appreciated by 11.2% from January 2020 to January 2021. This marks the highest annual rate of price growth since February 2006! The month over month number was strong as well, rising 0.8%. The hottest markets were Phoenix, up 15.8%, Seattle up 14.3%, and San Diego up 14.2%.
The Federal Housing Finance Agency’s House Price Index (HPI) also came out, showing a monthly increase of 1% and whopping 12% increase year over year. Like the Case Shiller, this report’s information is from the month of January. The HPI measures appreciation across the nation, but it focuses on single family homes purchased with conforming loan limits. Because of this, the FHFA HPI is known to more closely represent lower priced homes. Since there is less housing inventory of lower priced homes, this report tends to run slightly, “hotter” than the Case-Shiller.
There is no secret that over the last year homes across the nation had very strong levels of appreciation. Going forward experts are forecasting appreciation to continue over the next year as demand for homes remains very strong and as supply continues to run scarce.