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Economy in Brief

Home Price Appreciation Slowest in Three Years
by Tom Moeller November 30, 2006

According to the Office of Federal Housing Enterprise Oversight (OFHEO) home prices in the U.S. rose last quarter but the 0.9% gain was the slowest since 1998 and the y/y increase of 7.7% was the worst since 2003.

Price declines were scattered throughout the country. Job cutbacks in the auto industry helped lower prices in Michigan for the second consecutive quarter and in New York a 0.3% decline dropped the y/y rate of home price appreciation to 6.5%, the worst since 1999. Prices also fell q/q in Massachusetts (for the second quarter, +1.1% y/y), Rhode Island (+4.6% y/y) and New Hampshire (+3.7% y/y).

Home price appreciation in the District of Columbia continued reasonably firm last quarter at 1.0% but the still healthy y/y gain of 11.3% was down from last year's peak of 25.2%. Home prices in Idaho also turned in a strong showing with a 3.0% (17.5% y/y) increase. Notable for strength also were prices in Florida which rose 1.2% (15.1% y/y) though that is down from a 25.9% gain during all of last year.

The House Price Indices in this report are weighted indexes based on repeat sales or refinancings using data provided by Fannie Mae or Freddie Mac .

The latest report from the Office of Federal Housing Enterprise Oversight (OFHEO) can be found here.

House Price Index (OFHEO) 3Q '06 2Q '06 Y/Y 2005 2004 2003
United States 0.9% 1.3% 7.7% 13.2% 10.7% 6.9%
  California 0.6% 1.5% 10.2% 23.4% 22.3% 12.3%
  New Jersey 0.8% 1.8% 9.2% 16.3% 14.9% 10.6%
  New York -0.3% 1.0% 6.5% 13.8% 13.3% 10.4%
  Michigan -0.5% -0.7% -0.6% 4.3% 4.3% 3.4%
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