A Small Gain for Home Prices: FHFA

The FHFA monthly index is calculated using purchase prices of houses with mortgages that have been sold to or guaranteed by Fannie Mae or Freddie Mac. The index is 9.4% below its April 2007 peak and is roughly equivalent to its level in April 2005.

Home prices continue to recover fastest in the Mountain states, which saw a price hike of 1.3% compared with July. For the past 12 months, gains have been greatest in the Pacific states, up 18.2% and lowest in the Middle Atlantic states, which are up 4%.

The August gain was the smallest this year. Price gains were highest at the beginning of the year.

The consensus estimate for August called for an increase of 0.8%. The slowing pace of price hikes could provide a boost going forward or, perhaps more likely, buyers are gearing up for the holiday shopping season and putting home buying on hold for a while.