WASHINGTON (AP) — A government report says U.S. home prices fell 6.3% in January from the same month last year. The Federal Housing Finance Agency says prices, on a seasonally adjusted basis, rose 1.7% from December to January.
The government index is calculated using mortgage loans bought or guaranteed by federally controlled mortgage-finance companies Fannie Mae and Freddie Mac. It is down 9.6% from its peak in April 2007.
MP: There's one important and positive factor in the OFHEO report that the AP report completely missed (note the pessimistic tone). The bottom chart above (data here) shows the monthly percent change in the OFHEO House Price Index going back to February of 1991, and the 1.7% January 2009 increase in the home price index is the largest monthly increase in the history of the OFHEO data (almost 20 years)! Further, the record January increase follows ten consecutive monthly declines, and monthly declines in 18 out of the last twenty months.
Update: The top chart above displays the OFHEO Home Price Index back to Jan. 1991, and shows the record monthly increase in January. Perhaps the record monthly January price increase in the index signals that that the real estate market has hit a bottom. We'll see in the months ahead.