U.S. home prices increased 18.5% from the third quarter of 2020 to the third quarter of 2021. According to the Federal Housing Finance Agency House Price Index (FHFA HPI®), house prices were up 4.2% compared to Q2 of 2021. FHFA’s seasonally adjusted monthly index for September was up 0.9% from August.
Key findings:
- Housing markets have experienced positive annual appreciation since 2012.
- Home prices increased in all 50 states and DC between the third quarters of 2020 and 2021.
- The five states with the highest annual appreciation were Idaho (35.8%), Utah (30.3%), Arizona (27.7%), Montana (26.0%) and Florida (24.8%).
- The areas showing the lowest annual appreciation were District of Columbia (8.0%), North Dakota (10.5%), Louisiana (10%), Maryland (12.5%) and Iowa (13.0%).
- Home prices rose in all of the top 100 largest metropolitan areas over the last four quarters. Annual price increases were greatest in Boise City, Idaho, where prices increased by 37.%. Prices were weakest in Philadelphia, Pennsylvania, where they increased by 9.9%.
- Of the nine census divisions, the Mountain division posted the strongest four-quarter appreciation—25.0% increase between the third quarters of 2020 and 2021 and a 5.8% increase in Q3 of 2021. Annual house price appreciation was weakest in the West North Central division, where prices increased by 14.8% between the third quarters of 2020 and 2021.
The takeaway:
“House price appreciation reached its highest historical level in the quarterly series,” said William Doerner, Ph.D., Supervisory Economist in FHFA’s Division of Research and Statistics, in a statement. “Compared to a year ago, annual gains have increased in every state and metro area. Real estate prices have risen exceptionally fast, but market momentum peaked in July as month-over-month gains have moderated.”
