The housing market is one of the most important economic indicators to watch. A rising house price index reflects a growing economy and can boost consumer confidence. On the other hand, a falling real estate price index can signal a slowdown in the economy or even a recession.

The National Association of Realtors (NAR) releases the monthly House Price Index (HPI), which is calculated based on actual sales data from NAR-member MLSs. In addition to revealing general trends, the HPI also reports monthly and year-overyear changes in home prices. This indicator is useful for a variety of stakeholders, including home buyers and investors. Click for more https://www.offernow.com/

Unlike the more familiar indices, like the Dow Jones or the S&P 500, which are composed of weighted stocks and bonds, real estate prices are highly heterogeneous goods, meaning that different houses have very different characteristics. For this reason, real estate market price indices are quality-adjusted to ensure that they reflect the average property type and location.

While some analysts argue that a high level of quality adjustment in the indices could cause distortions, others point out that the unadjusted indices often fail to capture important factors that affect consumers’ purchasing power. For example, an increase in mortgage rates or a decrease in household income may depress the number of homes a household can afford. First American’s proprietary Real House Price Index (RHPI) addresses this issue by adjusting real estate prices for purchasing power.

RHPI’s three key components are housing costs, consumer household incomes and

mortgage rates. By inflating or deflating the prices for each of these three fundamentals, we can show how real estate markets are changing across the country, and how they are affecting consumer house-buying power.

In addition to determining whether or not you can afford to buy a new home, house price indices can also help you identify up-and-coming neighborhoods where values are steadily rising. This can be a great opportunity for investors who are looking to acquire properties in the best locations and sell them for a profit once their value increases.

When you are evaluating your purchase or investment options, it’s always important to consider the long-term effects of inflation. For this reason, we also include an inflation-adjusted version of the house price index. This version of the house price index includes an adjustment that makes it easier to compare prices over time and to assess how long-run trends are impacted by inflation.

The real estate market is a complex business, with many different players and influences that can affect home prices. To make sense of the situation, it is crucial to have access to a broad set of market information. That’s why this interactive map displays both the unadjusted house price index and the inflation-adjusted RHPI for each city. Simply hover over a state for more detailed data. You can even select the different housing indices for each county in order to get a more localized picture of the market.