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Th e M Rep o RT | 49 O r i g i nat i O n s e r v i c i n g a na ly t i c s s e c O n da r y m a r k e t ANALYTICS the latest FHFa and s&P/case-shiller record increasing Home Prices in index reports Average home prices are now 20 percent higher than three years ago. a ccording to the Federal Housing Finance Agency's (FHFA) quarterly House Price Index (HPI), U.S. house prices increased 1.3 percent in Q1 2015. The S&P/Case-Shiller Home Price Indices also indicated in their monthly report that home prices continued to rise in March 2015. In the purchase-only, season- ally adjusted index, this will be the 15th consecutive price increase for the FHFA HPI. The HPI data is taken from home sales price information from mortgages sold to, or guaranteed by, Fannie Mae and Freddie Mac. "The first quarter saw strong and widespread home price growth throughout most of the country," said Andrew Leventis, FHFA principal economist. "Home prices are now, on average, roughly 20 percent above where they were three years ago. This run-up has been historically exceptional and is particularly notable in light of the limited household income growth and modest rate of overall inflation observed during that same time period." The FHFA's seasonally ad- justed monthly index for March increased 0.3 percent from February. The seasonally ad- justed, purchase-only HPI rose 5 percent from Q1 2014 to Q1 2015. The inflation-adjusted price of homes increased approximately 6.5 percent over the last year. Home prices rose in 48 states between Q1 2014 and Q1 2015. Among the top five states in an- nual appreciation were: Colorado (11.2 percent), Nevada (10.1 percent), Florida (8.7 percent), Washington (7.6 percent), and California (7.5 percent). The S&P/Case-Shiller Home Price Indices found that both the 10-City and 20-City Composites saw year-over-year increases in March. The 10-City Composite increased 4.7 percent year- over-year, while the 20-City Composite gained 5 percent year- over-year. "Home prices have enjoyed year-over-year gains for 35 con- secutive months," said David M. Blitzer, managing director and chairman of the index commit- tee for S&P Dow Jones Indices. "The pattern of consistent gains is national and seen across all 20 cities covered by the S&P/Case- Shiller Home Price Indices. The longest run of gains is in Detroit at 45 months; the shortest is New York with 27 months. However, the pace has moderated in the last year; from August 2013 to February 2014, the national index gained more than 10 percent year-over-year, compared to 4.1 percent in this release." According to the Case-Shiller Index, which covers all nine U.S. census divisions, an annual gain of 4.1 percent was recorded in March 2015, compared to a 4.2 increase in February 2015. San Francisco and Denver experi- enced price increases of 10.3 per- cent and 10 percent, respectively, over the last 12 months and had the highest year-over-year gains. March saw a 0.8 percent month-over-month increase, the report says. Both, the 10- and 20-City Composites increased significantly, reporting 0.8 per- cent and 0.9 percent month-over- month increases, respectively. San Francisco led all cities with an increase of 3.0 percent out of the 19 cities reporting. Seattle came in second with an increase of 2.3 percent. "Given the long stretch of strong reports, it is no surprise that people are asking if we're in a new home price bubble," Blitzer said. "All of this suggests that some future moderation in home prices gains is likely. Moreover, consumer debt levels seem to be manageable. I would describe this as a rebound in home prices, not bubble, and not a reason to be fearful."