Home Prices in April – Rising Moderately

Both FHFA and S&P/Case-Shiller home price indexes rose moderately in April.

S&P Dow Jones Indices reported that the Case-Shiller (CS) National Home Price Index rose at a seasonally adjusted annual growth rate of 0.9% in April, slightly faster than the downwardly revised 0.7% in March. The Home Price Index from the Federal Housing Finance Agency (FHFA) slowed to a 2.8% seasonally adjusted annual rate in April, down from 10.2% in March.

After the boom and bust, home prices have been recovering from the trough since 2012. According to the Case-Shiller (CS) national home price index, the pace of house price appreciation has slowed since the last month of 2015. The annualized pace of house price growth averaged 2.8% over the first four months of 2016, down from 5.3% in 2015. Going forward house prices are expected to continue rising steadily at a sustainable pace.

Figure1_Apr16

Despite the monthly volatility of home price appreciation, the increases of recent months have brought house prices more in line with long term trend levels. The S&P/Case-Shiller home price index was very close to the trend line, and the FHFA home price index was slightly above the long term trend line.

Figure2_Apr16



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