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First Cut: FHFA House Price Index up more than expected month-over-month in January, but year-over-year price increases have plateaued

The seasonally adjusted FHFA Housing Price Index for January was up 0.6% at 271.95 compared to 270.41 in December. The increase was more than expected and the largest since up 1.1% in February 2018. However, year-over-year the unadjusted index showed that prices increases have reached a plateau at up 5.6% in January compared to a year earlier, virtually the same as the up 5.7% in December 2018 compared the year-ago month. The was the smallest year-over-year increase since 5.5% in February 2016.

 

Home prices remain on a modest upward trajectory, but clearly the accelerated pace of the prior two years has faded to one which may be less intimidating to potential homebuyers.

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