U.S. house prices rose 17.5% from the fourth quarter of 2020 to the fourth quarter of 2021, according to the Federal Housing Finance Agency House Price Index (FHFA HPI). House prices were up 3.3% compared to the third quarter of 2021. FHFA’s seasonally adjusted monthly index for December was up 1.2% from November.
“House prices continued to climb but not as rapidly during the final quarter of 2021 as in earlier quarters,” says William Doerner, Ph.D., supervisory economist in FHFA’s Division of Research and Statistics. “Housing trends over the past year have created challenges. The quick house price gains may be counterbalanced as mortgage rates increase. However, more expensive housing has elevated affordability to become a broader concern as available supply remains limited.”
Housing markets have experienced positive annual appreciation since the start of 2012. House prices rose in all 50 states and the District of Columbia between the fourth quarters of 2020 and 2021. The five areas with the highest annual appreciation were Arizona (27.4%), Utah (27.1%), Idaho (27%), Florida (25.6%) and Tennessee (24.1%). The areas showing the lowest annual appreciation were District of Columbia (6.6%), Louisiana (10.2%), North Dakota (10.3%), Maryland (10.8%) and Alaska (11.3%).
House prices rose in all of the top 100 largest metropolitan areas over the last four quarters. Annual price increases were greatest in Cape Coral-Fort Myers, Fla., where prices increased by 34.6%. Prices were weakest in Frederick-Gaithersburg-Rockville, Md. (MSAD), where they increased by 8.5%.
Of the nine census divisions, the Mountain division recorded the strongest four-quarter appreciation, posting a 23.1% gain between the fourth quarters of 2020 and 2021 and a 3.5% increase in the fourth quarter of 2021. Annual house price appreciation was weakest in the West North Central division, where prices rose by 13.6% between the fourth quarters of 2020 and 2021.
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