The Federal Housing Finance Agency's (FHFA) index of U.S. house prices rose 7.3% y/y in January, following December's 6.7% advance, revised up from 6.5%. The rate of increase has improved from 5.3% in 2014 and contrasts to the house price deflation from 2008 to 2011. In the month of January alone, house prices rose 0.8% m/m, rebounding after December's 0.4% increase, revised from 0.3%. Over the past three months, prices have risen at a 7.1% annual rate.

Around the country, prices in the Mountain and Pacific regions remained the strongest year/year, with the Mountain states showing a double-digit gain of 10.0%. The Pacific region's prices were almost as strong at 9.4% y/y. The South Atlantic, New England and East North Central regions had gains close to the national average, at 7.8%, 7.1%, and 7.0%, respectively, comparing January 2018 to January 2017. Prices in the East South Central states rose 6.6% y/y, those in the Middle Atlantic 6.2%, and in the West North Central, 5.8%.

All of the above regions showed stronger year/year gains than they did last month and stronger monthly increases as well.

The only region with slower prices was the West South Central, where they declined m/m in January by 0.7%, and the y/y increase slowed to 5.1% from 6.6% in December.

The FHFA house price index is a weighted purchase-only index that measures average price changes in repeat sales of the same property. An associated quarterly index also includes refinancings on the same kinds of properties. The indexes are based on transactions involving conforming, conventional mortgages purchased or securitized by Fannie Mae or Freddie Mac. Only mortgage transactions on single-family properties are included. The FHFA data are available in Haver's USECON database.