FHFA Home Price Index Rises More Than Expected

Home-price appreciation had been flat but now appears, after yesterday's very strong new home sales report and today's FHFA house price report, to be trending higher. The FHFA index for March rose a higher-than-expected 0.7 percent, for the best reading since September, with the year-on-year rate jumping over the 6 percent line to 6.1 percent for the best reading since October. The Pacific and Mountain regions lead the way at year-on-year gains in the high single digits with New England and the Mid-Atlantic in the rear with appreciation in the low single digits. Home price appreciation, during a time of weak wage growth, is central to household wealth and today's report points squarely to consumer strength. Watch for Case-Shiller price data on next week's calendar.

Recent History Of This Indicator:
FHFA house price index has been rising at solid 0.5 percent to 0.6 percent clips since October and another 0.5 percent gain is expected for March. The year-on-year rate, however, has not been keeping pace, moving slowly off the 6.0 percent line to 5.6 percent in the February report. Strength in home appreciation is of special importance in a low inflation, low wage-growth economy.