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National Home Prices Increased 7.2% Year Over Year in December 2016

Tuesday, February 14, 2017

Click below for the CoreLogic Home Price Index (HPI®) Report

National home prices increased 7.2% year-over-year in December 2016, according to the latest CoreLogic Home Price Index (HPI®) Report. While the HPI has increased on a year-over-year basis every month since February 2012, prices are still 3.9% below the April 2006 peak.

Home prices have risen 44% since bottoming out in March 2011, and are expected to increase by 4.7% from December 2016 to December 2017. Prices are projected to return to the April 2006 peak in mid-2017. Adjusting for inflation, U.S. home prices increased 5.8% year-over-year in December 2016, and were 18.6% below their peak [1].

Figure 1 shows the year-over-year HPI growth for the 25 highest-appreciating states in December 2016, along with their highest and lowest historical price changes. Washington showed the largest HPI gain of all states in December 2016 with a 10.8% year-over-year increase, followed closely by Oregon (+10.3%).

Prices in 27 states have risen above the pre-crisis peaks. Nevada home prices were the farthest below their all-time HPI high in December 2016, still 32% below the March 2006 peak.

CoreLogic also analyzes four individual home-price tiers that are calculated relative to the median national home price [2]. Figure 2 shows the levels of the four price tiers indexed to January 2006, shortly before each of the tiers hit its peak index value. The low-price tier has shown the most price growth in recent months, increasing 10.2% year-over-year in December 2016. This price tier also recovered 63.4% from its lowest point in March 2011 and is the only price tier to pass (by 10.2%) its pre-housing-crisis peak.

The low-to-middle tier has recovered 52.8% from its lowest point in March 2011, and has grown 8.4% year-over-year and is now 5.4% below its peak.

The middle- to moderate-price tier increased 7.3% year-over-year in December 2016, but remains 5.4% below its peak.

The high-price tier, which fell the least during the housing crisis, increased by 5.7% year-over-year in December 2016, the slowest increase of all the price tiers. The high-price tier remains 3.9% below its peak.


[1] The Consumer Price Index (CPI) Less Shelter was used to create the inflation-adjusted HPI.

[2] The four price tiers are based on the median sale price and are as follows: homes priced at 75% or less of the median (low price), homes priced between 75 and 100% of the median (low-to-middle price), homes priced between 100 and 125% of the median (middle-to-moderate price) and homes priced greater than 125% of the median (high price).

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