May 31, 2007
OFHEO First Quarter Report: 0.35% Appreciation For SF MSAD
The latest OFHEO House Price Index (HPI) ranks California 46th in terms of year-over-year home price appreciation (1.19%) and measures Q1 2007 appreciation at a negative 0.84%. For the San Francisco/San Mateo/Redwood City MSAD, year-over-year appreciation measured 1.32% with appreciation of 0.35% in the first quarter of 2007, a marked difference from last year's report of 14.60% year-over-year appreciation and 1.15% in the first quarter (0.17% less than the full year gain).
Keep in mind, however, that the HPI is based on data from repeat single-family home sales, or refinancings, that involve conforming mortgages (under $417,000). Data from transactions involving either condominiums or non-conforming loans (two major components in the San Francisco market) are excluded from the Index.
As always, it’s just another data point and perhaps most meaningful relative to itself (rather than in the absolute). And no, we don't have any idea why they chose red to denote the highest positive four-quarter appreciation (10%+) and dark blue the lowest (-1.0% to 2.0%).
∙ OFHEO House Price Index: Q1 2007 (pdf) [ofheo.gov]
∙ OFHEO Reports 1.15% First Quarter Appreciation For San Francisco [SocketSite]
First Published: May 31, 2007 4:00 AM
Comments from "Plugged In" Readers
Hot and cold markets, duh :)
Posted by: sw at May 31, 2007 3:25 PM
How does the OFHEO get a result when their criteria remove all real estate in SF and San Mateo counties? I haven't seen a house for less than 417K in years.
Posted by: sw at May 31, 2007 3:47 PM
Mortage of $417k or less, not sale price. Of course, this means their sample is skewed completely to those purchases where an unusually high - for this area - percentage down payment is being made. Not sure what difference that is likely to make to the figures, but statistically at least it makes them "dubious".
Posted by: Amen Corner at May 31, 2007 3:56 PM
The HPI analysis also includes refi appraisals (to the extent they resulting in conforming refi mortgages). We all know that it is in everyone's interest to appraise high for a refi. Another reason why this index is not of much value in this area -- may be a decent data point in areas where housed are much, much cheaper, but not here.
Posted by: Anon at May 31, 2007 5:03 PM
i think the 417k is the level for jumbo loans. so it's not skewed towards high down payments but rather lower priced homes...at least when it comes to san francisco!
Posted by: anon at May 31, 2007 7:17 PM
Agreed. As much as I love stats and data, these numbers aren't very relevant to the Bay Area. I'm sure there are several California homeowners with loans under $417K, maybe even a few around here. But this data seems more relevant for markets like Blythe or Indio.
Posted by: Dude at June 1, 2007 8:47 AM