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Typically mortgage originators add about 50 to 100 basis points JUST BECAUSE IT'S A NON OWNER OCCUPIED PROPERTY, and Mark limited the amount any one lender can deliver to the gses at 7% of total deliveries.
From a risk to the gses book of business it's probably positive but the gses may be losing out on the more expensive and likely more profitable loans...
I think it is in the best interests of the Primary Mortgage Market to do business with stable private corporations who can cater more effectively to their customers needs.
Or would they rather deal with the weaknesses inherent in government controlled organizations, like the Federal NATIONALIZED Mortgage Association...
They already have FHA and Ginnie Mae.
What do you think?
I think it may be a tough sell for many politicians to understand how conceptually, releasing the gses is in the their best interests for increasing access to affordable housing and will likely be hit with a hard sell from the financial establishment that canceling the SPSA is a giveaway to the evil hedge fund guys....
You would think at this point after incurring Adverse Market Fees, limits on 2nd home and investor properties, and GFees 2x what they were when private corporations, that they would see it is in the financial establishments best interests to exit conservatorship.
The MBA, NHBA, and NAR seem to want it, but portfolio lenders like JP Morgan, Wells, and others may like the higher fees the way they are for their competition of mortgages with the gses.
We'll see what happens.
Mobile homes and novel underwriting criteria sounds risky for the book of business especially since they can't effectively price the added risk layers appropriately given a 4.55% capital requirement.
https://www.housingwire.com/articles/maryland-rule-loosens-credit-restrictions-for-homebuyers/
https://www.housingwire.com/articles/manufactured-housing-is-key-to-affordable-homeownership/
The Collins Plaintiffs did experience a violation of their Constutional rights in regards to having to wait out, "I don't lose sleep at night worrying about shareholders." Mel Watt.
When your Constutional rights are violated then it's your responsibility to find evidence of how you were harmed even though you have zero access to intra governmental communications?
I don't think this will get us what we want but as we begin our 14th year of conservatorship something is wrong with the government nationalizing their wards...
It is funny how the intellectual elitists want increased denisity zoning SO LONG AS IT'S NOT IN THEIR BACKYARD!
Freddie Mac did a pretty in depth analysis and found that OVER THE LAST 10 YEARS BUILDERS HAVE NOT BUILT ENOUGH HOUSING TO MATCH ANNUAL DEMAND AND OBSOLESCENCE. As a nation we are short about 4 million houses, that's alot.
Supply is furthered constrained by NIMBY, once you obtain your 'castle' NOBODY WANTS THEIR LOCAL GUBMINT approving increased density zoning ANYWHERE NEAR THEIR HOME.
On the demand side, the Millenials, approximately 80 million strong just have become of age to start families and of course they want a house asap.
Mortgage rates are at 50 year lows, covid has ramped up demand for more space and these tech workers are tending to move from expensive coastal markets to lower cost interior markets and blowing away the locals with their yuge offers.
Worldwide bond yields are at historic lows, I bet your rental property is generating higher yields than any of your bond funds, as people are starving for yield, why do you think they are calling your cell phone number to ask if you want to sell your rental?
Plaintiffs reply response then procedurally I believe it's eventually oral arguments, judges deliberate for some time, then they render a decision.
REMEMBER ALL THESE MOTIONS AND ARGUMENTS ARE JUST TO GET TO THE TRIAL STAGE.
IF WE GET THERE AND WE CAN EXPOSE UNCLE SUGGYS SHANANIGANS AND A JUDGE CAN SEE JUST HOW BADLY THEY'VE ACTED WE MAY AFTER ALL THESE YEARS OF ABUSE GET SOME RELIEF!
The article and research done by these Federal Reserve Bank of NY senior economists was done simply to try to find an answer to the question: Does 50 year lows in mortgage rates substantially increase housing values? Their conclusion was that it has a positive impact but not substantially.
Many market commentators have assumed that the $120B/month buying of US Treasuries and MBS by the Federal Reserve is creating an asset bubble in US home values, according to this paper, it's not having a substantial impact...
"But empirically, we find that home values are nowhere near as sensitive to interest rates as the user cost model predicts. This lower sensitivity is also found in prior economic research. Thus, the historical experience suggests that lower interest rates can only account for a tiny fraction of the pandemic house price boom. Instead, we find more scope for lower interest rates to explain the rise in housing activity, both sales and construction."
https://libertystreeteconomics.newyorkfed.org/2021/09/the-housing-boom-and-the-decline-in-mortgage-rates/
Perhaps the continued government overreach and interference with private property rights via these unprecedented eviction moratoriums will awaken some of these federal judges when it comes to the Takings Clause. This is from todays WSJ, in response to NY's extension of the moratorium to cover up to 22 months in total: "Justices cited the Court's Loretto (1982) decision that found New York had engaged in a taking by requiring landlords to give cable companies access to their property. The Court broadened that precedent in Cedar Point Nursery this summer, holding that a temporary restriction on a landowner's right to exclude constituted a per se physical taking."
"The Rent Stabilization Association, which represents 25,000 New York City landlords, says it plans to seek an injunction against the new evictions ban. Landlords declined to challenge the previous ban as an unconstitutional taking—i.e., a government seizure of private property for public use without just compensation. But this time it should."
Here's the WSJ article in it's entirety:
The Supreme Court last month partially blocked New York's eviction moratorium, but Democrats in Albany shrugged off the rebuke and last week enacted another ban that goes through Jan. 15. The new ban raises fresh constitutional issues, so the Justices may get another bite at this big apple.
New York's previous ban had allowed nonpaying tenants to stay if they claimed to have suffered a pandemic-related hardship. Landlords weren't allowed to challenge their assertion. The Supreme Court held 6-3 that this violated the due process clause and "longstanding teaching that ordinarily 'no man can be a judge in his own case.'"
Under the new ban, landlords can challenge their tenants' claims, but they must file "an affidavit under penalty of perjury" certifying that they believe "in good faith that the hardship certified in the hardship declaration does not exist." Landlords could face criminal penalties if a court decides they haven't proven a tenant's claims are false, and New York courts are notoriously friendly to tenants.
States have broad police powers under the Constitution to protect public health and safety, but their authority is not limitless and their actions are subject to judicial scrutiny. Last fall the U.S. Supreme Court blocked then Gov. Andrew Cuomo's pandemic emergency restrictions on houses of worship. As Justice Neil Gorsuch wrote, "Even if the Constitution has taken a holiday during this pandemic, it cannot become a sabbatical." That's as true for landlord property rights as it is for religious liberty.
The Rent Stabilization Association, which represents 25,000 New York City landlords, says it plans to seek an injunction against the new evictions ban. Landlords declined to challenge the previous ban as an unconstitutional taking—i.e., a government seizure of private property for public use without just compensation. But this time it should.
The Court last month enjoined the Centers for Disease Control and Prevention's nationwide evictions moratorium for exceeding statutory authority, but the unsigned opinion by the 6-3 majority also noted that "preventing them from evicting tenants who breach their leases intrudes on one of the most fundamental elements of property ownership—the right to exclude."
Justices cited the Court's Loretto (1982) decision that found New York had engaged in a taking by requiring landlords to give cable companies access to their property. The Court broadened that precedent in Cedar Point Nursery this summer, holding that a temporary restriction on a landowner's right to exclude constituted a per se physical taking.
New York is forcing landlords to allow tenants to physically occupy their property for months with no guarantee of just compensation. Its Emergency Rental Assistance Program covers a maximum of 15 months of rent, and the state has been slow and incompetent in rolling it out. With the new law, a moratorium will have been in place for some 22 months, and some halted evictions predate March 2020.
Landlords who receive government rental assistance aren't allowed to raise rent for a year even if their property taxes and utility and maintenance costs increase. An eviction moratorium may have been justified amid the uncertainty of the early pandemic. But the economic and public-health emergencies ended long ago, and New York's constitutional sabbatical needs to stop.
New York Trashes Landlords Again
Credit: By The Editorial Board
These companies have great business models, Uncle Suggy initially set them up as private corporations with private capital in a 1st Loss Position. Why Uncle Suggy doesn't want to bring that model back is troubling (because they want to Nationalize two private corporations?).
What's more disturbing is the inability of federal judges to let us shareholders have our day in court with a full blown trial to expose the governments true motivations behind the Nationalization of these two private corporations!
Americans should be in control of their government and not the other way around! This 4th branch of government is becoming an abomination of the Constitutional Rights of American Citizens like you and me!
We'll see what happens....
Next Wednesday September 08, 2021 will begin the 14th year of the temporary conservatorship, unbeleivable! A self dealing conservator that creates the nws to siphon its wards profits GETS ZERO PRESS COVERAGE AND WE THE SHAREHOLDERS ARE THE BAD GUYS!
Seem just a little surreal?
ful·crum noun
the point on which a lever rests or is supported and on which it pivots.
a thing that plays a central or essential role in an activity, event, or situation.
"research is the fulcrum of the academic community"
se·cu·ri·ty noun
1.the state of being free from danger or threat.
"the system is designed to provide maximum security against toxic spills"
Similar:
certainty
safe future
assured future
safety
reliability
dependability
solidness
soundness
2. a thing deposited or pledged as a guarantee of the fulfillment of an undertaking or the repayment of a loan, to be forfeited in case of default.
Sounds like the fulcrum security is a can't miss !
"For the last century, the Supreme Court has been a willing enabler in this process — emboldening the “rise and rise of the administrative state” in a series of decisions that have primarily abdicated the court’s duty to enforce our structural separation of powers. For example, the court has upheld disconcertingly broad conferrals of lawmaking power that should reside in Congress alone — like statutes authorizing agencies to decide rules as they deem “fair and equitable,” or in the “public interest.”
https://pacificlegal.org/daily-journal-when-washington-bureaucrats-hold-the-reins-of-power/
Are you still holding out for a 5:1 conversion?
Ohh, okay. Well that's exactly quantifiable! What conclusion if any can one draw on the derivative versus direct claims on Constitutional Violations such as Takings Clause violations?
"The fact that the growers retain a contingent interest of indetermi-
nate value does not mean there has been no taking, particularly
when that interest depends on the discretion of the taker, and may be
worthless, as it was for one of the two years at issue here. Andrus v.
Allard, 444 U. S. 51, distinguished. Once there is a taking, as in the
case of a physical appropriation, any payment from the Government
in connection with that action goes, at most, to the question of just
compensation."
"The clear and administrable rule
is that “just compensation normally is to be measured by ‘the market
value of the property at the time of the taking.’ ” United States v. 50
Acres of Land, 469 U. S. 24, 29"
Question: Having been briefed by the Fannie Mae CFO, that the golden years were just ahead, Was the value of the taking via the nws NOT related to stock price on the OTCBB SINCE THE TAKER WAS PRIVY TO INSIDER INFORMATION?
Is your argument that the POTUS has the extremely rarely used ability to ignore court orders and therefore "Let them try to enforce the courts order", like Andrew Jackson and Abraham Lincoln did or is it that federal executive agencies can ignore the courts orders independent of the POTUS?
We could use this image on the front of the anniversary card we send yearly to the Director of the FHFA:
https://www.pinterest.com/pin/444308319476925664/
It's the broke monopoly man...
Old Hanky...I remember Bush 1 wanted to charge the gses a "access fee" but never got it. Bush 2 came in and took the whole thing lock, stock, and barrel....
Great point! It was Hanky who wanted them Nationalized! I think he is spending his golden years giving away his vast sums. No doubt repentance for his dastardly deeds with the twins and he's hoping some last minute redemption will get him through the pearly gates!
Why don't you send a check to him so he can deposit it with his favorite charity
https://www.nature.org/en-us/about-us/where-we-work/latin-america/latin-america-conservation-council/members/hank-paulson/
"Simply put, it has terrible optics. It looks like the results were suppressed for political and ideological reasons. Specifically, at the usual time scheduled for the release (August 2020), then-Director Calabria was heavily involved in trying to complete a new regulatory capital requirement to apply to the two GSEs, which – as per his well-known viewpoint – he wanted to be very high. His narrative justifying such a very high capital requirement – namely, that the GSEs for years had excessively lax credit underwriting standards and thus would be subject to very large losses in a downturn – was directly contradicted and undermined by the stress test results from last year. Hence, one can reasonably conclude he may have used the pandemic as an excuse to suppress the test results because they contradicted his narrative.
Additionally, this episode certainly looks like a high-handed regulatory action, which sets a troubling precedent about regulator discretion. Since the Dodd-Frank stress test and the disclosure of a summary of the results is legally required, it certainly seems rather questionable.
Given that the stress test results from a year ago were known inside the FHFA in the summer of 2020, the second troubling decision was that the agency, just a few months later, went ahead anyway and finalized the proposed combined GSE capital requirement at a very high level – specifically $283 billion (based upon June 2020 data). This was generally regarded by commenters on the capital proposal as far too high. Given the actual stress test results from the end of 2019 (the last known at that time inside the FHFA, but not disclosed to the public until now), this means the required capital was 40 times the “without DTA write-down” amount of $7.1B (which I believe to be the likely outcome) and nearly 10 times the “with DTA write-down” amount of $29.1B (the unlikely outcome). Those are excessive ratios, reflecting that the regulatory capital requirement seems wholly inconsistent with the stress test results. And when considering the stress losses from the end of 2020, which even includes positive income for the “without DTA write-down” calculation, the regulatory capital requirement seems to be even more out of line with the reality of modeled stress loss.
To sum up, the doubled-up stress test results just released are good news for the US housing finance system because they show that the GSEs, as its biggest players, have very significantly reduced their risk exposure, making the entire system stronger and more stable. The results, however, are not good when it comes to evaluating the Calabria era at the FHFA, as they highlight two troubling decisions that appear to show politics and ideology unduly distorting proper regulation."
Upset? I think we all are! Here's the latest from Don Layton. https://www.jchs.harvard.edu/blog/gse-stress-test-results-good-news-troubling-decisions
Here's TH's latest comments: "Yes, I had read the Layton piece (which came out yesterday).
The results of the 2020 and 2021 Dodd-Frank stress tests run on Fannie and Freddie were released earlier this month, and have received almost no publicity. I find that surprising, since they reveal that the tests run this year (on year-end 2020 data) showed that neither Fannie nor Freddie needed ANY capital to pass them, and Fannie also was able to pass the 2020 test (run on year-end 2019 data) with no capital.
In this piece, Layton points out that FHFA did not publish the results of the 2020 test–which should have come out a year ago–until this month, when it released the results of both the 2020 and 2021 tests together. He speculates that Director Calabria may have withheld the 2020 results, using Covid as a (weak) pretext, because they did not conform with the capital standard he was proposing, which had a “risk-based” requirement of more than 4.0 percent. I find it hard to argue with this interpretation, which Layton says “appear to show politics and ideology unduly distorting proper regulation.”
The timing of both the release of the FHFA Dodd-Frank stress tests for Fannie and Freddie and Layton’s analysis of it are helpful for the piece on Fannie and Freddie’s capital that I will be putting up next week. The companies now are locked into an essentially endless conservatorship by a series of actions based on a provably fictitious view of their past and present risks. In next week’s piece I will give actual data on Fannie’s historical and current credit risk–which are publicly available–and note that if you plug today’s data into the companies’ Great Financial Crisis experience they would need NO initial capital to survive it. I’ll also discuss how Calabria came up with his requirement that Fannie had to have 4.55 percent capital for its June 30, 2020 book to be considered “adequately capitalized.” (Preview: his 4.0 percent minimum is imposed arbitrarily, and his “risk-based” requirement is full of assumptions, exclusions, and cushions engineered to produce a result that exceeds that minimum.)
To get Fannie and Freddie out of conservatorship and back to being able to price the one product they are allowed to offer–credit guarantees on residential mortgages–on an economic basis, all the Biden administration has to do is abandon the fictions and embrace the (readily available) facts about them. It is in its best interest to do so."
"For investors, the single-family home market has been heralded as a pandemic success story. Shares of the two largest companies, Invitation Homes Inc. and American Homes 4 Rent, climbed 38% since late February of 2020, compared with about 10% for the largest apartment companies, according to real-estate research firm Green Street Advisors.
Investors purchased $87 billion in homes in the first half of 2021, according to real-estate company Redfin, including a record 68,000 houses in the second quarter.
Since June, Blackstone Group Inc., Invesco Ltd. and Goldman Sachs Group Inc. alone have committed more than $11 billion to the sector. Meanwhile, other companies are building rental homes from scratch. New houses meant to be rented instead of sold account for about 12% of single-family construction in 2021, said Doug Ressler, a researcher at Yardi.
Tricon Residential Inc., a publicly traded house owner, reported new lease rent increases of around 21% in July, a record for the company. The average increase was 5% for renewal tenants. In an August earnings call, Gary Berman, Tricon's chief executive, said in some markets, the company could fetch close to 10% rent increases for existing tenants if it didn't intentionally "hold back."
Tricon launched a $5 billion fund this summer to acquire 18,000 more houses and convert them into rentals. It is also purchasing new construction homes through a separate venture. "What we tell prospective investors is look, we can't satisfy the demand. We need a lot more supply," Mr. Berman said.
Deep-pocketed investors may have a hand in would-be buyer woes: one in six home sales went to an investor in the second quarter of 2021, according to Redfin."
From todays WSJ.
Nice, the government has gone from conserve and preserve to greed and retribution (is that really in the public interest that FHFA serves)!
Here's the problem with increasing the supply of affordable housing in Amerika, this is from footnote 1 of Jared Bernstein's blog this morning from the White House: https://apps.urban.org/features/cost-of-affordable-housing/
For some reason I think many of us somehow believe that the government will do the right thing, but next week, September 08, 2021, as we complete 13 YEARS of a temporary conservatorship, very few are left.
"Therefore, in order to restore the balance between safety and soundness and mission, FHFA has placed Fannie Mae and Freddie Mac into conservatorship. That is a statutory process designed to stabilize a troubled institution with the objective of returning the entities to normal business operations. FHFA will act as the conservator to operate the Enterprises until they are stabilized."
https://www.fhfa.gov/Media/PublicAffairs/Pages/Statement-of-FHFA-Director-James-B--Lockhart-at-News-Conference-Annnouncing-Conservatorship-of-Fannie-Mae-and-Freddie-Mac.aspx
"As part of this plan, the Administration will take several concrete steps to ensure that single-family homes held by the Federal government eventually go to owner occupants, or to community-oriented non-profits committed to rehabilitating homes and selling them to owner occupants.
HUD and the Enterprises plan to increase to 30 days, from 10–20 days, the period in which only non-profits and owner occupants—as opposed to financial market investors—can make offers on the more than 12,000 homes in their Real Estate Owned (“REO”) inventory. These are homes in their portfolio that have failed to sell in a foreclosure auction.
Further, HUD and the Enterprises will continue to expand outreach to community-oriented non-profits and local governments regarding the sale of federally held homes. Because the Federal housing finance agencies guarantee mortgage repayments, the agencies often have a number of foreclosed homes in their portfolio. Under this new approach, they will cut through red-tape to ensure these properties quickly get on the market, with special access to those most in-need of such assistance.
The Administration also plans to increase financing for manufactured homes and 2–4 unit properties.
FHFA will authorize Freddie Mac to purchase mortgages for single-wide manufactured homes, thereby extending its 2020 authorization to Fannie Mae. The Enterprises also will continue outreach on financing options for manufactured homes. Such properties have been significantly improved in terms of quality and amenities and, because they are pre-manufactured, they can quickly enter the supply chain.
FHFA will authorize the Enterprises to take steps to expand the number of mortgages available for purchases of 2–4 unit properties that have an owner-occupant and renters. In so doing, it will be easier for prospective buyers to purchase and build wealth with these properties, and the supply of rental housing can expand as well.
Increasing the supply of multifamily housing is a cornerstone of the Administration’s plan to alleviate housing supply constraints. One proven way to do so is to increase the affordability of financing for building multiunit dwellings, particularly those targeted at low- and moderate-income renters.
The Low-Income Housing Tax Credit (LIHTC) is a tax credit to builders of low-income housing that have a proven track record of increasing the supply of affordable rental units. The Enterprises will build on this record by raising their equity cap for LIHTC from $1 billion to $1.7 billion—from $500 million each to $850 million each.
Treasury and HUD have formulated a plan to provide affordable financing from the Federal Financing Bank, which is tasked with buying, selling, and originating Federal loans and debt to State Housing Finance Agencies.
Treasury is making $383 million in the Capital Magnet Fund available for the purpose of encouraging affordable housing production. The Capital Magnet Fund is a competitive grant program for Community Development Finance Institutions and non-profit housing groups.
Legislative Steps
The Administration urges Congress to invest in the construction of affordable housing units, incentivizing the relaxation of exclusionary zoning and helping income-burdened renters.According to HUD, these investments will add or rehabilitate approximately 2 million housing units nationally. In particular, these supply-side policies will:
Construct or rehabilitate affordable rental housing units using Federal subsidies to support the financing, building, and maintenance of affordable rentals. This would be done principally by expanding the HOME Investment Partnership Program, the Housing Trust Fund, and the Capital Magnet Fund.
Expand and strengthen LIHTC. As noted above, LIHTC has a proven track record of incentivizing the building of affordable multifamily units. The Administration has proposed to expand LIHTC and target some portion of additional allocations to areas that are particularly supply constrained.
Build and rehabilitate homes for low- and middle-income homebuyers and homeowners. Based on the innovative and bipartisan Neighborhood Homes Investment Act, the Administration proposes a tax credit subsidy for building and rehabilitating homes for low- to middle-income homeowners living in economically vulnerable communities. Given racial disparities in home values, this proposal advances the Administration’s agenda on racial equity by boosting home values in economically distressed communities, which are disproportionately inhabited by people of color.
Incentivize the removal of exclusionary zoning and harmful land use policies. One of the most persistent and binding constraints on housing supply is exclusionary zoning laws and practices. For decades, such laws have inflated housing costs, locking families out of areas with more opportunities. Along with working with State and local governments to reduce such restrictions, the Administration proposes the creation of an incentive program that awards flexible and attractive funding to jurisdictions that take concrete steps to reduce barriers to affordable housing production."
MC, "1000 to 1 leverage keeps me up at night, worrying.". Mel Watt, "I don't stay up at night worrying about the shareholders!". Sandra L Thompson, "We can expand the affordable housing credit box AND not have more risk."
Wouldn't it be nice if we were in charge of our own destiny?
Sandra L Thompson's mantra of "more affordable housing credit accessibility WITHOUT THE ADDED RISK", reminds me of SM's "We need to get them out of government control".
I'll believe it when I see it!
Let's hope she doesn't have amnesia when it comes to her 20 years of experience as a bank regulator and load the gses up with high risk highly unprofitable loans.
U.S. June home prices rise at record annual pace -S&P/Case-Shiller
https://mobile.reuters.com/article/amp/idUSKBN2FW16H
"Today’s S&P Case Shiller Index spotlights a hot summer’s housing market, where buyers prepared with cash for down payments and low interest rate loans placed competing bids for an evaporating supply of homes available for sale and drove prices higher," said George Ratiu, manager of economic research for Realtor.com.
"In a noticeable shift, July saw real estate markets welcome a larger influx of new listings, as homeowners across the country decided to move on with pandemic-delayed plans to sell."
https://www.fanniemae.com/newsroom/fannie-mae-news/fannie-mae-releases-july-2021-monthly-summary
Fannie Mae's Guaranty Book of Business increased at a compound annualized rate of 0.4% in July.
• The Conventional Single-Family Serious Delinquency Rate decreased 14 basis points to 1.94% in July.
• The Multifamily Serious Delinquency Rate decreased 7 basis points to 0.46% in July.
• As of July 31, 2021, 1.7% and 1.6% of our Single-Family Conventional Book of Business based on unpaid
principal balance and loan count, respectively, was in active forbearance, the vast majority of which were
related to COVID-19; 8% of these loans in forbearance (based on loan count) were current.
• As of July 31, 2021, 0.2% of our Multifamily Guaranty Book of Business based on unpaid principal balance
was in an active forbearance, the vast majority of which were related to COVID-19.
• In July 2021, Fannie Mae issued resecuritizations that were backed by $12.0 billion in Freddie Mac securities.
• As of July 31, 2021, Fannie Mae's maximum exposure to Freddie Mac collateral that was included in
outstanding Fannie Mae resecuritizations was $175.0 billion.
IMPORTANT NOTE:
Fannie Mae has been under conservatorship, with the Federal Housing Finance Agency (FHFA) acting as
conservator, since September 6, 2008.
It's mostly graphics anyway! You didn't miss much! There were only 12 views when I watched it.
The bottom line for the twins is that these record price increases on US Homes will result in bigger earnings from a reduction in Loan Loss Reserves.
This will help our Conservator increase its Liquidation Preference!
U.S. House Price Index Report 2021 Q2
Published: 8/31/2021
?Washington, D.C. – U.S. house prices rose 17.4 percent from the second quarter of 2020 to the second quarter of 2021 according to the Federal Housing Finance Agency House Price Index (FHFA HPI®). House prices were up 4.9 percent compared to the first quarter of 2021. FHFA’s seasonally adjusted monthly index for June was up 1.6 percent from May.
“During the second quarter, house prices peaked in June with an 18.8 percent growth rate compared to a year ago,” said Dr. Lynn Fisher, Deputy Director of FHFA’s Division of Research and Statistics. “For the quarter, annual gains surpassed 20 percent in the Mountain, New England, and Pacific census divisions and in all of the top 20 metro areas.”
View highlights video featuring Dr. Lynn Fisher at https://go.usa.gov/xFhX4?.
Significant Findings
House prices have risen for 40 consecutive quarters, or since September 2011.
House prices rose in all 50 states and the District of Columbia between the second quarters of 2020 and 2021. The five states with the highest annual appreciation were: 1) Idaho 37.1 percent; 2) Utah 28.3 percent; 3) Arizona 23.9 percent; 4) Montana 23.7 percent; and 5) Rhode Island 23.7 percent. The states showing the lowest annual appreciation were: 1) Alaska 8.2 percent; 2) North Dakota 8.7 percent; 3) Louisiana 9.6 percent; 4) Mississippi 11.4 percent; and 5) Iowa 11.5 percent.
House prices rose in all of the top 100 largest metropolitan areas over the last four quarters. Annual price increases were greatest in Boise City, ID, where prices increased by 41.1 percent. Prices were weakest in San Francisco-San Mateo-Redwood City, CA, where they increased by 4.5 percent.
Of the nine census divisions, the Mountain division experienced the strongest four-quarter appreciation, posting a 22.9 percent gain between the second quarters of 2020 and 2021 and a 6.8 percent increase in the second quarter of 2021. The Mountain division has led in annual growth for 15 quarters. Annual house price appreciation was weakest in the West North Central division, where prices rose by 14.9 percent between the second quarters of 2020 and 2021.
Trends in the Top 100 Metropolitan Statistical Areas are available in our interactive dashboard: https://www.fhfa.gov/DataTools/Tools/Pages/FHFA-HPI-Top-100-Metro-Area-Rankings.aspx. The first tab displays rankings while the second tab offers charts.
The FHFA HPI is the nation’s only collection of public, freely-available house price indexes that measure changes in single-family home values based on data from all 50 states and over 400 American cities that extend back to the mid-1970s. The FHFA HPI incorporates tens of millions of home sales and offers insights about house price fluctuations at the national, census division, state, metro area, county, ZIP code, and census tract levels. FHFA uses a fully transparent methodology based upon a weighted, repeat-sales statistical technique to analyze house price transaction data.
FHFA releases HPI data and reports on a quarterly and monthly basis. The flagship FHFA HPI uses seasonally adjusted, purchase-only data from Fannie Mae and Freddie Mac. Additional indexes use other data including refinances, FHA mortgages, and real property records. All the indexes, including their historic values, and information about future HPI release dates are available on FHFA’s website: https://www.fhfa.gov/HPI.
Tables and graphs showing home price statistics for metropolitan areas, states, census divisions, and the U.S. are included on the following pages.
Note
?The next monthly HPI report (including data through July 2021) will be released September 28, 2021, and the next quarterly HPI report (including data for the third quarter of 2021 and monthly data for September) will be released November 30, 2021.
Release dates for the remainder of 2021 and all of 2022 are posted at https://www.fhfa.gov/DataTools/Downloads/Pages/House-Price-Index.aspx#ReleaseDates?.
Follow @FHFA on Twitter, LinkedIn, Facebook, and YouTube for more HPI news.?