Monthly and yearly home price gains continued to trend lower in February as purchase affordability pressures kept homebuying demand muted, softening price gains.
Updating its House Price Index (HPI) on Tuesday, the Federal Housing Finance Agency (FHFA), which regulates Fannie Mae and Freddie Mac, said house prices were unchanged from January to February and only 1.7% higher on a seasonally adjusted basis compared to one year ago.
Yearly gains in February were only slightly higher than the 1.6% annual growth the previous month. The FHFA revised upward January’s monthly gain in home prices to 0.2% from the initial estimate of 0.1%, which still reflects a slowdown from the 0.3% gain in December.
The HPI tracks national trends as well as regional home price performance in the nine U.S. census divisions. Midwest markets in the West North Central and East North Central census divisions roughly doubled the national average for annual growth with 3.1% and 3.8% yearly gains, while home prices across the Middle Atlantic and New England divisions also continued to outperform, rising 3.1% and 4.2% over the year.
Monthly gains in these markets were less impressive, however. Only New England posted monthly growth, matching the 0.2% national average, while Middle Atlantic home prices slipped 0.1% from January, East North Central prices were flat and home prices across the West North Central division declined 0.4%.
After being the only region to post monthly and annual losses in January, the West South Central division, which includes Texas, Oklahoma, Arkansas and Louisiana, reversed consecutive months of declines with 0.2% growth in February, despite home prices sliding 0.1% over the year across the region.
Instead, the Pacific (Washington, Oregon and California) and Mountain (Arizona, Colorado, Idaho, Montana, Nevada, New Mexico, Utah and Wyoming) census divisions both posted notable monthly and annual home price declines in February.
The Pacific division declined 0.5% from January and 0.4% over the year, while the Mountain division was harder hit, dropping 1.1% over the month and 0.7% from a year ago.
