Posted May 26, 2015
in Real Estate Sales

Today’s Mortgage Rates Push Home Values To Within 1.3 Percent Of Last Decade’s Peak Prices

FHFA Home Price Index: Home values rise to their highest point since September 2007 and are now within 1.3% of the all-time high set in April 2007

Home Values Highest Since September 2007

Home values continue to climb.

According to the FHFA Home Price Index, property values rose nationwide in March, marking the sixteenth straight month of home price growth; and thirty-seventh out of 38. Home values are up 5.1% percent since 12 months ago.

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

Freddie Mac has reported the average 30-year mortgage rate at 3.84% -- the 27th 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 Hits 91-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 March 2015, the Home Price Index climbed to 221.0 -- its highest reading since September 2007.

September 2007 is in the history of U.S. housing. That month, last decade's housing downturn was fewer than 6 months old and home values had yet to drop in many U.S. markets. Additionally, the Housing and Recovery Act had yet to be created; and the HARP refinance program was still 18 months from its launch. 

National home values are now just 1.3 percent below the valuation peak, set in April 2007. 

The March 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®, 46% of homes for sale are selling 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 3.84 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.

Tennessee, Kentucky 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.

These gains don't apply to all areas equally, however. This is because the government's Home Price Index examines the housing market  broadly, and does little to capture the specific buyer-seller activity of any one state, city, or neighborhood.

The Home Price Index does group its findings by region, however, and, on a monthly basis, the East South Central region led all U.S. markets in March, expanding 0.9% from the month prior. New England was the laggard, losing 0.5 percent, on average.

Since last year, home price growth has varied by region:

  • Pacific : +6.8% (Hawaii, Alaska, Washington, Oregon, California)
  • Mountain : +7.2% (Montana, Idaho, Wyoming, Nevada, Utah, Colorado, Arizona)
  • Middle Atlantic : +3.5% (New York, New Jersey, Pennsylvania)
  • East North Central : +5.0% (Michigan, Wisconsin, Illinois, Indiana, Ohio)
  • South Atlantic : 5.8% (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 +2.7 percent since last year -- the slowest rate of growth among the FHFA's 10 tracked regions.

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)