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Thinking about buying a home this spring? You'll want to check out the latest update to the income needed to buy a median-priced home in the top 50 metro areas.

Thinking about buying a home this spring? You'll want to check out the latest update to the income needed to buy a median-priced home in the top 50 metro areas.

Home price recovery index: Which metros have improved the most, least?

Keith Gumbinger

home price recovery By September 2021, homes in all 100 of the top metro markets fully recovered any value they lost during the last housing bust, but that doesn't mean there still isn't a race to the top... and up from the bottom, too. The geographic mix of markets with the greatest value increases since previous price peaks continues to change, as does the group of areas where home value recoveries have taken longer and been more meager. While home values in all markets are above the peaks of the last boom, at least some areas are less so of late, as home values in some markets have retreated a bit from pandemic-fueled record highs.

HSH.com’s Home Price Recovery Index uses a Federal Housing Finance Agency's (FHFA) Home Price Index as a basis to determine which of the top 100 housing markets have fully recovered value lost (or more) in the last housing bust and which still lag behind in the current housing recovery. The time period covered by the HPI begins with the first quarter of 1991 and runs through the third quarter of 2023. We compare the metro's previous peak value from the mid-2000s housing boom against present values to determine if a given market has recovered all of its value lost in the 2011-2013 housing market bust, and how much above previous high-water marks a market is now.

Quarterly update:
The third quarter of each year typically sees the start of seasonal home price deceleration, a routine occurrence that usually deepens into the fourth quarter. This year, the decline in home values was much less broad and deep than usual; only 9 metro areas saw lower home values in the third quarter of 2023 compared to the second. Last year, the same quarter-to-quarter shift saw 48 markets with seasonal value declines, so even as home sales have slumped this year, home values remain well supported.

Of the nine metros with lower values, no decline was greater than 2%, and most reductions were a fraction of one percent. Of this small group, the El Paso, TX market posted a decline of 1.86% and the greater San Francisco metro saw a 1.35% drop. Even a year-ago comparison shows that only seven metros had lower home values this year compared to the same period last year, so there's not much by way of seasonal price relief for any potential homebuyers brave enough to jump into today's rugged housing conditions.

Most recovered group
The high-flying metro areas that have topped the list of markets with the greatest value increases since the mid-aughts housing boom have changed over time, but not so much this quarter. The three markets occupying the 1-2-3 slots now for a long time continue to do so, but with less dominance than they previously had. For example, home values in the Austin-Round Rock-Georgetown TX metro area have retreated considerably after peaking in the second quarter of 2022; while the value here is still 176.4% above its previous "boom-era" high (3Q 2008), this is considerably less than the 216.33% above achieved in the second quarter of 2022.

This is much the same for other top-tier markets, although less so. The Denver-Aurora-Lakewood CO market was as high as 180.34% above its prior peak in 2Q22 but has settled back to "only" 172.06% in the latest quarter. In the case of the #3 metro area (Dallas-Plano-Irving TX) last quarter's fade in value was more than erased, and this market is now at it's highest recovery level to date, with current home values in the region 162.51% above their previous high.

Despite more mixed levels of value increases among the top ten most recovered markets, metros occupying the top five slots remained unchanged again. In fact, the same 10 metros populated the list for a second consecutive quarter, but with a slight bit of shuffling. The Buffalo-Cheektowaga, NY moved up a slot to #6, bumping Charlotte-Concord-Gastonia, NC-SC down a notch to #7, and a swapping of positions was also seen for Knoxville, TN and Greenville-Anderson, SC, which moved up one slot to #8 and down on to #9, respectively. The Boise City, ID metro again rounds out the group with the greatest leap in value compared to mid-aught's "boom era" prior value peaks.

It'll take some softening of values in the top group of metros and some strengthening in value by those metros just outside it to effect any change in the "most recovered" list. Although they have some gap to close, the three metros with the best shot to move up are Raleigh-Cary NC, Charleston-North Charleston SC and the Grand Rapids-Kentwood, MI regions.

The metro areas with the smallest gains over values seen in the prior boom continued to benefit from rising values. Of the least improved 10 metros, only the Frederick-Gaithersburg-Rockville MD metro posted a quarterly dip in value, and this was only 0.5% for the period. The nine others continued to post solid value increases of around 2% on average, and even the Bakersfield, CA metro now has a value that is 24.52% above a boom-era high reached back in the second quarter of 2006. It's hard to think that this market's "boom-era" high was now some 17 years ago, but also worth considering that this market didn't even reach a fully recovered level until the second quarter of 2021.

Retiring the HPRI
As we've noted in the last few updates to the HPRI, we knew at some point there would be no more "recovery" in our Home Price Recovery Index. We expect to track the "most recovered" group for a while longer yet, and of course, HSH's Home Value Estimator (MyHPI) will continue to be updated, so you can track changes in your favorite metro as we go along.

Last year, we introduced a new means of following changes in home values. Our Home Value Tracker uses a different set of FHFA data that includes both repeat purchases and refinances, so it's a very robust data set. However, as there is no "refinancing season" (and in fact, no refinancing at times at all!) the data is not seasonally adjusted and so can be more volatile from quarter to quarter. That said, Home Value Tracker covers more than four times the metro areas as did our HPRI covering over 400 metros in all, and provides five value-change reference points -- change from last quarter, two quarters ago and one, three and five years ago. The new HVT contains two tables showing home values changes in the metros with the 10 largest and 10 smallest home price changes over the last year, and a unique lookup tool so you can see your local market's changes over those time points, too.

We've also created a new custom-time-period tracking tool Home Value Tracker-MyHVT, where you can see what's happened to home values in any of the 400+ metros over any time frame you like, including what's happened while you owned your home (or any other period) -- from 1995 to now.

How has your home value changed in the time you've owned it?
The HPRI only reviews trough-to-peak changes for each market in our evaluation, so your local experience in value change from when you purchased your home to today will of course be different. To see what's happened with home prices during the time you've owned your home, check our home value estimator, MyHPI. To see where you are in your mortgage, use our mortgage amortization calculator.

Tracking and projecting your home equity
The combination of home price increases and your retirement of the amount you owe may see you with a larger equity stake than you think. If you're interested in how much equity you've got in your home or are looking to pursue a future home equity goal, you'll want to check out our Home Equity Calculator and Projector.

10 metro areas that have recovered the most

Metro
Area
Peak high
value
Post-peak
Low value
Current
value
Amount
now
above
prev peak
Austin-Round Rock-Georgetown, TX 264.92 254.66 732.23 176.40%
Denver-Aurora-Lakewood, CO 269.90 247.72 734.29 172.06%
Dallas-Plano-Irving, TX (MSAD) 170.76 163.53 448.27 162.51%
Nashville-Davidson--Murfreesboro--Franklin, TN 220.09 193.72 560.86 154.83%
Fort Worth-Arlington-Grapevine, TX (MSAD) 167.18 158.84 422.05 152.45%
Buffalo-Cheektowaga, NY 145.65 144.60 339.52 133.11%
Charlotte-Concord-Gastonia, NC-SC 193.48 158.69 451.00 133.10%
Knoxville, TN 205.28 179.12 477.90 132.80%
Greenville-Anderson, SC 191.35 171.56 438.08 128.94%
Boise City, ID 294.29 161.83 668.56 127.18%

Can some locations or properties still not have achieved recovery?

Since the HPRI compares values that are derived from an entire metropolitan area (some of these quite expansive) it's certainly possible that some homes or neighborhoods have not participated in the home price recovery as strongly as other areas in the same metro. In fact, and although it continues to diminish, CoreLogic reported that in the second quarter of 2023, the total number of residential properties with negative equity was still 1.1 million homes, or 2% of all mortgaged properties. This figure is actually 4 percent higher compared to the second quarter of 2022. With seasonal home price cooling expected to be seen in the third and fourth quarters, it's likely that this number will expand a bit more year. Regardless, the problem of some homeowners being "underwater" still persists and may worsen if homebuying conditions don't improve.

However, even if home prices don't increase for such homes or areas, homeowners will eventually come to a positive equity position as they make regular payments on their mortgages, and even small improvements in home values over time will tend to help fill in any value gap. In this way, even if the value of a specific home hasn't yet returned to a previous high, it's not as though the homeowner won't ever have any equity.

For example, in the case of a home purchased at a previous price peak in early 2006 (and assuming no refinance of the mortgage) the homeowner would have paid off about 32 percent of the original loan amount by now. This calculation doesn't include any downpayment the homeowner may have made, so the equity stake would be increased by that amount, too. Purchases made before the peak period or after prices began to descend would see this equity stake be increased as well. Given interest rates in place in 2006 -- 30-year FRMs at about 6.5% in the third quarter, odds favor that a homeowner would have refinanced at least once (if not twice) by now to take advantage of falling rates, and a 3.5% refinance in September 2012 would still even see the homeowner with more than a 32% retirement of principal by now.

How has the value of YOUR home changed?

HSH.com has developed a tool that allows you to see how the price change in your market has affected the value of your home. With our "Home Value Estimator," you select your market and the time frame in which you have owned your home to estimate how the changes in your market have impacted your home’s value. If your market still hasn't fully recovered and you think your home is still underwater, find out when you'll have positive home equity again with our KnowEquity When calculator.

All now recovered, the remaining 90 metro areas

Here's a look at the remaining 90 metro areas from the FHFA's HPI list.

Metro
Area
Peak high
value
Post-peak
Low value
Current
value
Amount still
below peak
value
Amount
now above
prev peak
Akron, OH 176.85 139.97 297.26 n/a 68.09%
Albany-Schenectady-Troy, NY 183.35 167.49 299.96 n/a 63.60%
Albuquerque, NM 238.84 188.76 383.15 n/a 60.42%
Allentown-Bethlehem-Easton, PA-NJ 203.93 151.96 303.88 n/a 49.01%
Anaheim-Santa Ana-Irvine, CA (MSAD) 286.6 196.5 474.33 n/a 65.50%
Atlanta-Sandy Springs-Alpharetta, GA 198.18 137.97 423 n/a 113.44%
Bakersfield, CA 252.07 118.37 313.88 n/a 24.52%
Baltimore-Columbia-Towson, MD 267.43 204.59 353.21 n/a 32.08%
Baton Rouge, LA 229.83 213.52 352.9 n/a 53.55%
Birmingham-Hoover, AL 211.78 173.74 369.21 n/a 74.34%
Boston, MA (MSAD) 268.23 219.01 466.97 n/a 74.09%
Bridgeport-Stamford-Norwalk, CT 239.61 181.16 317.47 n/a 32.49%
Cambridge-Newton-Framingham, MA (MSAD) 256.98 211.66 463.4 n/a 80.33%
Camden, NJ (MSAD) 222.92 162.72 321.71 n/a 44.32%
Cape Coral-Fort Myers, FL 317.13 132.11 485.52 n/a 53.10%
Charleston-North Charleston, SC 286.13 202.42 639.86 n/a 123.63%
Chicago-Naperville-Evanston, IL (MSAD) 236.85 159.31 298.95 n/a 26.22%
Cincinnati, OH-KY-IN 179 148.87 341.4 n/a 90.73%
Cleveland-Elyria, OH 173.04 134.07 283.1 n/a 63.60%
Colorado Springs, CO 260.01 216.71 565.32 n/a 117.42%
Columbia, SC 186.89 160.33 333.13 n/a 78.25%
Columbus, OH 180.02 157.28 387.99 n/a 115.53%
Dayton-Kettering, OH 155.57 124.64 278.58 n/a 79.07%
Detroit-Dearborn-Livonia, MI (MSAD) 207.3 111.61 315.03 n/a 51.97%
El Paso, TX 196.56 170.99 320.39 n/a 63.00%
Elgin, IL (MSAD) 200.24 128.18 266.94 n/a 33.31%
Fort Lauderdale-Pompano Beach-Sunrise, FL (MSAD) 351.46 176.46 577.37 n/a 64.28%
Frederick-Gaithersburg-Rockville, MD (MSAD) 276.61 205.03 360.46 n/a 30.31%
Fresno, CA 273.67 137.9 362.92 n/a 32.61%
Gary, IN (MSAD) 187.78 158.85 325.65 n/a 73.42%
Grand Rapids-Kentwood, MI 183.73 136.72 408.98 n/a 122.60%
Greensboro-High Point, NC 167.03 142.3 319.82 n/a 91.47%
Hartford-East Hartford-Middletown, CT 172.2 144.14 236.21 n/a 37.17%
Houston-The Woodlands-Sugar Land, TX 196.48 189.73 423.9 n/a 115.75%
Indianapolis-Carmel-Anderson, IN 159.1 144.07 344.44 n/a 116.49%
Jacksonville, FL 299.92 179.75 534.27 n/a 78.14%
Kansas City, MO-KS 200.17 163.82 408.03 n/a 103.84%
Lake County-Kenosha County, IL-WI (MSAD) 208.9 138.91 266.05 n/a 27.36%
Las Vegas-Henderson-Paradise, NV 268.98 99.96 373.21 n/a 38.75%
Little Rock-North Little Rock-Conway, AR 190.93 182.05 313.25 n/a 64.07%
Los Angeles-Long Beach-Glendale, CA (MSAD) 276.03 165.29 432.62 n/a 56.73%
Louisville/Jefferson County, KY-IN 200.24 186.32 385.18 n/a 92.36%
Memphis, TN-MS-AR 175.51 144.11 318.53 n/a 81.49%
Miami-Miami Beach-Kendall, FL (MSAD) 414.23 214.12 719.09 n/a 73.60%
Milwaukee-Waukesha, WI 235.03 188.03 393.75 n/a 67.53%
Minneapolis-St. Paul-Bloomington, MN-WI 262.79 186.86 406.05 n/a 54.52%
Montgomery County-Bucks County-Chester County, PA (MSAD) 212.33 182.16 341.88 n/a 61.01%
Nassau County-Suffolk County, NY (MSAD) 299.84 234.03 440.5 n/a 46.91%
New Haven-Milford, CT 201.31 152.24 271.58 n/a 34.91%
New Orleans-Metairie, LA 265.24 222.07 400.45 n/a 50.98%
New York-Jersey City-White Plains, NY-NJ (MSAD) 270.82 218.23 390.93 n/a 44.35%
Newark, NJ-PA (MSAD) 270.05 205.21 379.52 n/a 40.54%
North Port-Sarasota-Bradenton, FL 340.37 160.45 601.87 n/a 76.83%
Oakland-Berkeley-Livermore, CA (MSAD) 307.63 162.07 474.29 n/a 54.18%
Oklahoma City, OK 200.27 192.02 390.45 n/a 94.96%
Omaha-Council Bluffs, NE-IA 200.65 180.95 402.84 n/a 100.77%
Orlando-Kissimmee-Sanford, FL 285.54 141.14 474.48 n/a 66.17%
Oxnard-Thousand Oaks-Ventura, CA 284.54 173.06 407.09 n/a 43.07%
Philadelphia, PA (MSAD) 236.91 202.03 389.36 n/a 64.35%
Phoenix-Mesa-Chandler, AZ 339.08 159.84 606.42 n/a 78.84%
Pittsburgh, PA 178.26 173.8 364.76 n/a 104.62%
Portland-Vancouver-Hillsboro, OR-WA 335.45 246.77 629.98 n/a 87.80%
Providence-Warwick, RI-MA 242.15 175.91 389.93 n/a 61.03%
Raleigh-Cary, NC 198.42 173.52 446.81 n/a 125.18%
Richmond, VA 238.21 182.69 407.88 n/a 71.23%
Riverside-San Bernardino-Ontario, CA 272.04 127.82 398.34 n/a 46.43%
Rochester, NY 138.1 133.89 274.64 n/a 98.87%
Sacramento-Roseville-Folsom, CA 258.07 126.32 357.02 n/a 38.34%
Salt Lake City, UT 352.61 259.75 765.52 n/a 117.10%
San Antonio-New Braunfels, TX 212.94 196.83 459.89 n/a 115.97%
San Diego-Chula Vista-Carlsbad, CA 298.12 187 505.61 n/a 69.60%
San Francisco-San Mateo-Redwood City, CA (MSAD) 280.96 212.96 518.57 n/a 84.57%
San Jose-Sunnyvale-Santa Clara, CA 293.7 196.17 550.03 n/a 87.28%
Seattle-Bellevue-Kent, WA (MSAD) 295.33 201.72 598.6 n/a 102.69%
St. Louis, MO-IL 210.59 171.64 344.07 n/a 63.38%
Stockton, CA 272.79 108.6 346.38 n/a 26.98%
Syracuse, NY 148.09 139.69 275.93 n/a 86.33%
Tacoma-Lakewood, WA (MSAD) 292.14 181.41 568.89 n/a 94.73%
Tampa-St. Petersburg-Clearwater, FL 310.09 168.35 613.13 n/a 97.73%
Tucson, AZ 303.78 173.03 478.94 n/a 57.66%
Tulsa, OK 187.43 170.13 363.37 n/a 93.87%
Urban Honolulu, HI 194.38 173.52 333.51 n/a 71.58%
Virginia Beach-Norfolk-Newport News, VA-NC 273.75 205.69 380.05 n/a 38.83%
Warren-Troy-Farmington Hills, MI (MSAD) 206.29 122.44 333.04 n/a 61.44%
Washington-Arlington-Alexandria, DC-VA-MD-WV (MSAD) 281.61 200.75 406.91 n/a 44.49%
West Palm Beach-Boca Raton-Boynton Beach, FL (MSAD) 321.29 153.93 569.44 n/a 77.24%
Wichita, KS 183.38 164.94 333.65 n/a 81.94%
Wilmington, DE-MD-NJ (MSAD) 216.23 165.26 303.69 n/a 40.45%
Winston-Salem, NC 173.57 153.77 336.01 n/a 93.59%
Worcester, MA-CT 231.42 168.83 371.29 n/a 60.44%

More about the HPI

The Home Price Index is a broad measure of the movement of single-family house prices. It has been published by the Federal Housing Finance Agency and precursor agencies since the fourth quarter of 1995.

For each market, the index uses 1991 home prices as a basis. Those dollars are "normalized" to a value of 100 for each market; that is, regardless of the actual dollar cost, the index value for a given market becomes 100. For example, a home price in Allentown, PA in 1991 might have been $65,000; this becomes a base value for Allentown of 100, and changes since then are presented as percentage changes from that initial 100 value.

The HPI is based on purchase-only transactions involving conforming, conventional mortgages purchased or securitized by Fannie Mae or Freddie Mac. Only mortgage transactions on single-family properties are included. The HPI does not include property transactions backed by FHA, VA, USDA or non-conforming (e.g. jumbo) mortgages.

The HPI is updated each quarter as additional mortgages are purchased or securitized by Fannie Mae and Freddie Mac.

The HPI is a weighted, repeat-sales index, meaning that it measures average price changes in repeat sales of the same properties.

The HPI shows the relative change in prices in a metropolitan area from quarter to quarter or period to period. HSH.com has pulled out information from each area to show the amount of change from 1991 to the pre-housing-crisis peak, the low achieved during or after the peak, and how much improvement has taken place since that near-term bottom.

The FHFA uses the revised Metropolitan Statistical Areas (MSAs) and Divisions as defined by the Office of Management and Budget (OMB) in Bulletin 20-01. If specified criteria are met and an MSA contains a single core population greater than 2.5 million, the MSA is divided into Metropolitan Divisions.

For more details on the HPI and how it is put together, see http://www.fhfa.gov/Media/PublicAffairs/Pages/Housing-Price-Index-Frequently-Asked-Questions.aspx

Mahesh January 28, 2019 9:58 am

one of the most important information who planning to invest in a home. Thanks, Keith Gumbinger.

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