Posted March 25, 2015
in Real Estate Sales

Low Mortgage Rates Helping To Push Home Values Near 2007 Peak

FHFA Home Price Index: U.S. home values at their highest point since late-2007

Home Values Highest Since November 2007

Home values continue to climb.

According to the FHFA Home Price Index, property values rose nationwide in January, marking the fourteenth straight month of home price growth. Home values are up 5.1% percent from last year and continue to move higher as the 2015 Housing Market begins.

Demand for homes is outweighing supply in many U.S. markets; and, today's mortgage rates are so low that they're changing the economics of "Buy vs Rent".

Freddie Mac has reported the average 30-year mortgage rates at 3.78% -- the 18th straight week that rates have been sub-4 percent. Buyer purchasing power is on the rise and low- and no-downpayment mortgages remain readily available.

It's an excellent time to be a U.S. home buyer.

Click to compare today's live rates.

Home Price Index Hit 86-Month Best

The FHFA Home Price Index is a product of the Federal Home Finance Agency (FHFA). It tracks changes in a home's value between subsequent sales. Data is supplied via Fannie Mae and Freddie Mac as part of the mortgage approval process.

The Home Price Index is benchmarked to a value of 100, which is meant to represent the U.S. housing market as it existed in 1991.

In January 2015, the Home Price Index climbed to 219.0 -- its highest reading since November 2007.

November 2007 is a significant date as compared to today's U.S. housing market. During that month, last decade's housing downturn was less than 12 months old and home values had yet to drop in many U.S. markets. Furthermore, the Housing and Recovery Act had yet to be created; and the HARP refinance program was still more than twelve months from its launch. 

Home prices are now just 3.5 percent below the valuation peak, which was set in March 2007. 

The January Home Price Index shows a housing market in expansion, with home prices growing at a more rapid pace as compared to mid-2014. Demand for homes outpaces the supply of them, and listing prices for home are rising. Competition for homes remain fierce.

According to the National Association of REALTORS®, more than one-third of homes for sale sell in 30 days or fewer. For today's buyers, it's become tough to find great, inexpensively-priced homes.

Thankfully, current mortgage rates are cheap.

Freddie Mac's weekly mortgage rate survey puts the 30-year conventional fixed-rate mortgage at 3.78 percent, on average, nationwide.

Lenders now quote mortgage rates and APRs in the mid-3s regularly, and adjustable-rate mortgage rates are as low as the 2s. FHA and VA mortgage rates are even lower.

Low mortgage rates give buyers extra purchasing power and expanded home affordability.

Click to get today's live mortgage rates.

Michigan, Illinois, Ohio Lead Winners

The FHFA's Purchase-Only Home Price Index rose is up 5.1% from one year ago. The index is at its highest point in more than 7 years.

Home values should not be considered on a national level, however. The Home Price Index examines housing broadly, and does little to capture buyer-seller activity in any one state, city, or neighborhood.

The Home Price Index does group its findings by region, however, and, in November, the East South Central region led all U.S. markets, expanding 2.3% from the month prior. The South Atlantic region was the laggard, losing 0.4 percent, on average.

Over the last 12 months, home price growth has varied by region:

  • Pacific : +8.2% (Hawaii, Alaska, Washington, Oregon, California)
  • Mountain : +6.5% (Montana, Idaho, Wyoming, Nevada, Utah, Colorado, Arizona)
  • Middle Atlantic : +1.7% (New York, New Jersey, Pennsylvania)
  • East North Central : +4.8% (Michigan, Wisconsin, Illinois, Indiana, Ohio)
  • South Atlantic : 4.1% (Delaware, Maryland, District of Columbia, Virginia, West Virginia, North Carolina, South Carolina, Georgia, Florida)

The New England Region, an area which includes Maine, New Hampshire, Vermont, Massachusetts, Rhode Island, and Connecticut is +2.9 percent since last year.

Get A Complimentary Mortgage Rate Quote

Home values are higher nationwide and U.S. mortgage interest rates are down. Today's low rates help to keep U.S. homes affordable for first-time buyers, repeat buyers, and investors alike.

Low rates can't last forever, though. Get a complimentary mortgage rate quote now. Rates are available for online at no cost, with no social security number required to get started, and with no obligation to proceed.

Click here to get rates.

The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.

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2015 Conforming, FHA, & VA Loan Limits

Mortgage loan limits for every U.S. county, as published by Fannie Mae & Freddie Mac, the Federal Housing Administration (FHA), and the Department of Veterans Affairs (VA)