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Welcome to the Government page of FHFA’s website.  This page provides consolidated resources for federal, state and local government personnel who are interested in the nation’s housing finance system.


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Key Legislation

 

Short Title (Citation)

Document

FEDERAL HOME LOAN BANKS

Federal Home Loan Bank Act

12 U.S.C. 1421 et seq.
(Public Law 72-304 (1932))

Established the Federal Home Loan Bank System.

 GPO Text / PDF

FEDERAL HOUSING FINANCE AGENCY CHARTER

Federal Housing Enterprises Financial Safety and Soundness Act of 1992

12 U.S.C. 4501 et seq.
(Public Law 102-550 (1992))

Primary statutory authorization for FHFA’s regulation of Fannie Mae, Freddie Mac and the Federal Home Loan Bank System, including supervision of housing mission and goals and actions as conservator or receiver for Fannie Mae, Freddie Mac or any Federal Home Loan Bank.

Housing and Economic Recovery Act of 2008

(Public Law 110-289 (2008))

Amended the Safety and Soundness Act to create FHFA, place regulation of Fannie Mae, Freddie Mac and the Bank System under one regulator, enhance supervision of these regulated entities, and enhance FHFA's authorities as conservator or receiver. 

 GPO​ Text / PDF










 
GPO Text / PDF

FREDDIE MAC CHARTER

Federal Home Loan Mortgage Corporation Act

12 U.S.C. 1451 et seq.
(Public Law 91-351 (1970))

Created Freddie Mac and provided authority for Freddie Mac’s activities.

 GPO Text / PDF

FANNIE MAE CHARTER

Federal National Mortgage Association Charter Act

12 U.S.C. 1716 et seq.
(Public Law 84-345,National Housing Act, Title III (1934), as amended by the Housing and Urban Development Act of 1968)

Created Fannie Mae and provided authority for Fannie Mae’s activities. Amendment in 1968 created the Government National Mortgage Association (Ginnie Mae), supervised by the Department of Housing and Urban Development.

 GPO Text / PDF

Find regulations pertaining to FHFA supervision at eCFR.

CONGRESSIONAL LETTERS


​​​

 Related Information

 

 

Prepayment Monitoring Report First Quarter 202340532<p style="padding-top&#58;12px !important;">​​​​​​​​​Fannie Mae and Freddie Mac began issuing the Uniform Mortgage-Backed Securities (UMBS) on June 3, 2019.<br></p><p>This quarterly report provides market participants additional transparency into a sample of the data FHFA receives and reviews on a monthly basis. The report focuses on alignment of prepayment rates, which continues to be important to the success of UMBS and to the efficiency and liquidity of the secondary mortgage market.</p><p>Ex post monitoring of prepayment rates is part of a broader effort to assure investors that cash flows from UMBS will be similar regardless of which Enterprise is the issuer. This report provides insight into how FHFA monitors the consistency of prepayment rates across cohorts of the Enterprises’ TBA-eligible MBS,<a href="#footnote1" class="super-script">1</a> where a cohort consists of those Enterprise TBA-eligible securities with the same coupon, maturity, and loan-origination year and total combined issuance across the Enterprises exceeds $10 billion. A prepayment on a mortgage loan is the amount of principal paid in advance of the loan’s scheduled payments. Full prepayment occurs when a borrower pays off the loan ahead of the scheduled maturity.</p><p> <strong>Background on UMBS</strong></p><p style="padding-bottom&#58;12px !important;">Issuance of UMBS through the Enterprises’ jointly developed Common Securitization Platform (CSS), fulfilled important elements of FHFA’s <a href="/AboutUs/Reports/Pages/2014-Conservatorships-Strategic-Plan.aspx"> <em>2014 Strategic Plan for the Conservatorships of Fannie Mae and Freddie Mac</em></a>. Forward trading of UMBS began in the “To-Be-Announced” (TBA) market​<a href="#footnote2" class="super-script">2</a>, on March 12, 2019 with first settlements of the UMBS trades on June 3, 2019. UMBS is issued without regard to which Enterprise is the issuer and has effectively merged the formerly separate MBS markets. UMBS has broadened and enhanced-liquidity in the secondary market for residential mortgages and reduced costs to taxpayers.<a href="#footnote3" class="super-script">3</a></p><hr /><p style="padding-top&#58;12px !important;"> <a name="footnote1" class="super-script">1</a>​ To avoid double counting, only first-level securitizations are included in the analysis. Second-level securitizations (Megas, Giants, and Supers) are excluded, with the exception of fastest quartile analyses and Table 2 (Quartile Report). For those exceptions, Freddie Mac multi-lender second-level securitizations traded as a single security are included and the related first-level securitizations are excluded to avoid double counting.</p><p> <a name="footnote2" class="super-script">2</a> The TBA market is a forward market for certain mortgage-backed securities, including those issued by the Enterprises.</p><p> <a name="footnote3" class="super-script">3</a> See <a href="/AboutUs/Reports/ReportDocuments/Single%20Security%20Update%20final.pdf">​<em>An Update on the Structure of the Single Security</em></a>, May 2015, p.4 </p>​​ <div class="ms-rtestate-read ms-rte-wpbox"><div class="ms-rtestate-notify ms-rtestate-read fa325f4b-170a-42f5-9cc7-935ecf34e67d" id="div_fa325f4b-170a-42f5-9cc7-935ecf34e67d" unselectable="on"></div><div id="vid_fa325f4b-170a-42f5-9cc7-935ecf34e67d" unselectable="on" style="display&#58;none;"></div></div>​​<br>6/2/2023 3:01:02 PMHome / About FHFA / Reports / Prepayment Monitoring Report First Quarter 2023 Prepayment Monitoring Report 331https://www.fhfa.gov/AboutUs/Reports/Pages/Forms/AllItems.aspxhtmlFalseaspx
Agencies Request Comment on Quality Control Standards for Automated Valuation Models Proposed Rule40497​<span style="font-style&#58;normal;">​​​​​</span> <hr style="line-height&#58;16px;font-size&#58;16px;" />​ <h4>​​Joint Release​​</h4><div><h4 style="font-style&#58;normal;font-variant&#58;normal;text-align&#58;right;">Board of Governors of the Federal Reserve System</h4><h4 style="font-style&#58;normal;font-variant&#58;normal;text-align&#58;right;">Consumer Financial Protection Bureau</h4><h4 style="font-style&#58;normal;font-variant&#58;normal;text-align&#58;right;">Federal Deposit Insurance Corporation</h4><h4 style="font-style&#58;normal;font-variant&#58;normal;text-align&#58;right;">Federal Housing Finance Agency</h4><h4 style="font-style&#58;normal;font-variant&#58;normal;text-align&#58;right;">National Credit Union Administration</h4><h4 style="font-style&#58;normal;font-variant&#58;normal;text-align&#58;right;">Office of the Comptroller of the Currency<br></h4><hr style="line-height&#58;16px;font-size&#58;16px;" /><p style="font-style&#58;normal;"> <span style="font-size&#58;inherit;font-family&#58;inherit;font-weight&#58;700 !important;">Washington, D.C.&#160;</span>–&#160;​<span style="font-family&#58;inherit;font-size&#58;inherit;font-weight&#58;inherit;">Six federal regulatory agencies today requested public comment on a proposed rule designed to ensure the credibility and integrity of models used in real estate valuations. In particular, the proposed rule would implement quality control standards for automated valuation models (AVMs) used by mortgage originators and secondary market issuers in valuing real estate collateral securing mortgage loans.&#160;&#160;</span></p><p>Under the proposal, the agencies would require institutions that engage in covered transactions to adopt policies, practices, procedures, and control systems to ensure that AVMs adhere to quality control standards desig​ned to ensure the credibility and integrity of valuations. The proposed standards are designed to ensure a high level of confidence in the estimates produced by AVMs;&#160;help protect against the manipulation of data; seek to avoid conflicts of interest;&#160;require random sample testing and reviews;&#160;and promote compliance with applicable nondiscrimination laws.&#160;&#160;<br></p><p>AVMs are used as part of the real estate valuation process, driven in part by advances in database and modeling technology and the availability of larger property datasets. While advances in AVM technology and data availability have the potential to contribute to lower costs and reduce loan cycle times, it is important that institutions using AVMs take appropriate steps to ensure the credibility and integrity of their valuations. It is also important that the AVMs institutions use adhere to quality control standards designed to comply with applicable nondiscrimination laws.&#160;&#160;<br></p><p>Comments must be received within 60 days of the proposed rule’s publication in the <em>Federal Register.</em><br></p><p><strong><span style="font-size&#58;12pt;font-family&#58;calibri, sans-serif;"><a href="/SupervisionRegulation/Rules/Pages/Quality-Control-Standards-for-Automated-Valuation-Models.aspx">Proposed Rule&#58; Quality Control Standards for Automated Valuation Models</a></span></strong>​<br></p></div>6/1/2023 8:00:15 PMBoard of Governors of the Federal Reserve System Office of the Comptroller of the Currency Washington, D.C. – ​Six federal regulatory agencies today requested public comment on a 1645https://www.fhfa.gov/Media/PublicAffairs/Pages/Forms/AllItems.aspxhtmlFalseaspx
FHFA Announces Membership in the Mitigation Framework Leadership Group (MitFLG)40441<p style="padding-top&#58;8px !important;">​<strong>​​​​​​​​​​​​​​​​​​​​Washington, D.C.</strong> – The Federal Housing Finance Agency (FHFA) today announced its membership in the <a href="https&#58;//www.fema.gov/emergency-managers/national-preparedness/frameworks/mitigation/mitflg" class="external-link">Mitigation Framework Leadership Group (MitFLG)</a>.​<br></p><p>Climate risk poses a serious threat to the U.S. housing finance system. Natural disaster events such as hurricanes, wildfires, and floods resulting from climate change present challenges for Fannie Mae, Freddie Mac, and the Federal Home Loan Bank System along with homeowners and renters.</p><p>“FHFA looks forward to working toward a coordinated, whole-of-government approach for resilience and mitigation measures that increase the housing finance system’s ability to manage and respond to climate risks,” said Daniel E. Coates, Deputy Director for the Division of Research and Statistics and Executive Sponsor of FHFA’s climate risk efforts.</p><p>FHFA’s <a href="/AboutUs/Reports/ReportDocuments/FHFA_StrategicPlan_2022-2026_Final.pdf">Strategic Plan for Fiscal Years 2022-2026</a> affirmed the Agency’s commitment to build on experiences with natural disaster response to ensure the prioritization of climate risk at the Agency and its regulated entities. FHFA additionally intends to learn from and contribute toward shared best practices for innovative and efficient mitigation measures nationwide. </p> <p style="margin-bottom&#58;0px !important;"> <strong>About the Mitigation Framework Leadership Group</strong></p><p>Established in 2013 by the Federal Emergency Management Agency (FEMA), MitFLG was formed to organize mitigation efforts across the federal government. The mission of MitFLG is to strengthen the nation’s disaster resilience by expanding mitigation awareness, coordination, and action. MitFLG also follows the priorities of the <a href="https&#58;//www.fema.gov/sites/default/files/2020-10/fema_national-mitigation-investment-strategy.pdf" class="external-link">National Mitigation Investment Strategy</a> released by FEMA in August 2019, and assesses the effectiveness of core mitigation capabilities across the United States. It is composed of federal, state, local, tribal, and territorial public-sector representatives. </p>5/31/2023 5:00:08 PMHome / Media / FHFA Announces Membership in the Mitigation Framework Leadership Group (MitFLG) News Release 1086https://www.fhfa.gov/Media/PublicAffairs/Pages/Forms/AllItems.aspxhtmlFalseaspx
Credit Risk Transfer Progress Report 4Q202240447<p style="padding-top&#58;12px !important;">​​​​​​​​​​​The Report provides a comprehensive picture of how Fannie Mae and Freddie Mac (the Enterprises) transfer a substantial portion of credit risk to the private sector through a variety of transactions in both the single-family and multifamily markets.<br></p><p>From the beginning of the Enterprises' Single Family CRT programs in 2013 through the end of 2022, the Enterprises transferred a portion of credit risk on approximately $6.2 trillion of unpaid principal balance (UPB), with a combined Risk in Force (RIF) of $197 billion, or 3.2 percent of UPB. In 2022, the Enterprises collectively achieved the highest level of single family CRT issuance volume since the inception of the CRT programs. The Enterprises transferred a portion of credit risk on $1.1 trillion of UPB in 2022.</p><p>​See the document below for more detailed information.<br></p>​​​<br>5/31/2023 6:00:05 PMHome / About FHFA / Reports / Credit Risk Transfer Progress Report 4Q2022 Credit Risk Transfer Progress 495https://www.fhfa.gov/AboutUs/Reports/Pages/Forms/AllItems.aspxhtmlFalseaspx
FHFA House Price Index Frequently Asked Questions21869​ <table width="75%" class="ms-rteTable-4" bgcolor="#f1f1f1" cellspacing="0"><tbody><tr class="ms-rteTableEvenRow-4"><td class="ms-rteTableEvenCol-4" style="width&#58;100%;"><h2 style="text-align&#58;center;">​​​Table of Contents<br></h2><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest1"><strong>1. What is the value of the FHFA House Price Index (HPI)?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest2"><strong>2. What transactions are covered in the FHFA HPI?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest3"><strong>3. How is the FHFA HPI computed?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest4"><strong>4. How often is the FHFA HPI published?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest5"><strong>5. How is the FHFA HPI updated?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest6"><strong>6. How do I interpret “four-quarter,” “one-year,” “annual,” and “one-quarter” price changes?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest7"><strong>7. How are Metropolitan Statistical Areas (MSAs) and Metropolitan Divisions defined and what criteria are used to determine whether an MSA index is published?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest8"><strong>8. Does FHFA use the September 2018 revised Metropolitan Statistical Areas (MSAs) and Divisions?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest9"><strong>9. What geographic areas are covered by the FHFA HPI?&#160;</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest10"><strong>10. What is the methodology used in computing the FHFA HPI?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest11"><strong>11. How does the FHFA HPI differ from the Case-Shiller®&#160;Index?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest12"><strong>12. How does the FHFA House Price Index differ from the Census Bureau’s Constant Quality House Price Index (CQHPI)?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest13"><strong>13. Where can I access MSA index numbers and standard errors for each year and quarter?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest14"><strong>14. What role do Fannie Mae and Freddie Mac play in the FHFA HPI?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest15"><strong>15. Why is the FHFA HPI based on Fannie Mae or Freddie Mac mortgages?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest16"><strong>16. When are the indexes normalized in the downloadable ASCII data?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest17"><strong>17. Is the FHFA HPI adjusted for inflation?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest18"><strong>18. How do I use the manipulatable data (in TXT files) on the Web site to calculate appreciation rates?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest19"><strong>19. How is&#160;the FHFA HPI constructed for MSAs?...</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest20"><strong>20. How can the FHFA HPI for an MSA be linked to ZIP codes within that MSA?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest21"><strong>21. How and why is the FHFA HPI revised each quarter?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest22"><strong>22. What transaction dates are used in estimating the index?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest23"><strong>23. Are foreclosure sales included in the FHFA HPI?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest24"><strong>24. How are the monthly FHFA House Price Indexes calculated?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest25"><strong>25. How are the Census Division and U.S. FHFA HPIs formed?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest26"><strong>26. What weights are used in forming the Census Division and U.S. FHFA HPIs?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest27"><strong>27. For those FHFA HPIs that are seasonally-adjusted, what approach is used in performing the seasonal adjustment?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest28"><strong>28. Do you have an FHFA&#160;HPI&#160;that includes loans which are not purchased or securitized by Fannie Mae or Freddie Mac?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest29"><strong>29. Is there an FHFA HPI that corrects for distressed sales?</strong></a></p><p> <a href="/Media/PublicAffairs/Pages/House-Price-Index-Frequently-Asked-Questions.aspx#quest29"><strong>30. Can I use the data in the FHFA HPI and, if so, how should the index be cited?</strong></a></p></td></tr></tbody></table><p> <br> &#160;</p><ol><li> <strong><a name="quest1">What is the value of the FHFA House Price Index (HPI)?</a></strong><br><br>The FHFA House Price Index (HPI) is a broad measure of the movement of single-family house prices.&#160; The FHFA HPIs are built on tens of millions of home sales and offer insights about house price fluctuations at the national, census division, state, metro area, county, ZIP code, and census tract levels.&#160; The FHFA HPIs use a fully transparent methodology based upon a weighted, repeat-sales statistical technique to analyze transaction data from Fannie Mae and Freddie Mac.&#160;&#160;The FHFA HPIs also provide housing economists with an analytical tool that is useful for estimating changes in the rates of mortgage defaults, prepayments and housing affordability in specific geographic areas.<br><br> Although FHFA constructs several indexes for different geographies and periods, the entire suite of HPIs is often referenced, in a general sense, as the &quot;FHFA HPI&quot;.&#160; The production of the FHFA HPI is statutorily mandated (12 U.S.C. 4542).&#160; The Office of the Federal Housing Enterprise Oversight (OFHEO), one of FHFA's predecessor agencies, began publishing the HPI in the fourth quarter of 1995.&#160; <br> <br>FHFA releases data and reports on a quarterly and monthly basis. The flagship FHFA HPI uses seasonally adjusted, purchase-only data, unless otherwise noted.&#160; Additional indexes are based on other data including refinances,&#160;FHA mortgages, and real property records.&#160; All the indexes can be downloaded from the FHFA website.<br><br>&#160;</li><li> <strong><a name="quest2">What transactions are covered in the FHFA HPI?</a></strong><br><br>The FHFA HPI is based on transactions involving conforming, conventional mortgages purchased or securitized by Fannie Mae or Freddie Mac. Only mortgage transactions on single-family properties are included. Conforming refers to a mortgage that both meets the underwriting guidelines of Fannie Mae or Freddie Mac and that does not exceed the conforming loan limit. For loans originated in the first nine months of 2011, the loan limit was set by Public Law 111-242. That law, in conjunction with prior legislation, provided for loan limits up to $729,750 for one-unit properties in certain high-cost areas in the contiguous U.S. Mortgages originated after September 30, 2011 were no longer subject to the terms of prior initiatives and, under the formula established under the Housing and Economic Recovery Act of 2008, the “ceiling” limit for one-unit properties in the contiguous U.S. fell to $625,500. For 2019-acquired loans, the ceiling limit rose to $726,525 for one-unit homes in the contiguous U.S.<br><br>​Conventional mortgages are those that are neither insured nor guaranteed by the FHA, VA, or other federal government entities. Mortgages on properties financed by government-insured loans, such as FHA or VA mortgages, are excluded from the FHFA&#160;HPI, as are properties with mortgages whose principal amount exceeds the conforming loan limit. Mortgage transactions on condominiums, cooperatives, multi-unit properties, and planned unit developments are also excluded.<br><br>&#160;</li><li> <strong><a name="quest3">How is the FHFA HPI computed?</a></strong><br><br>The FHFA HPI is a weighted, repeat-sales index, meaning that it measures average price changes in repeat sales or refinancings on the same properties. This information is obtained by reviewing repeat mortgage transactions on single-family properties whose mortgages have been purchased or securitized by Fannie Mae or Freddie Mac since January 1975. The FHFA HPI is updated as additional mortgages are purchased or securitized by Fannie Mae and Freddie Mac. The new mortgage acquisitions are used to identify repeat transactions for the most recent period and for each subsequent period&#160;since 1975.&#160; <br> <br>FHFA house price index reports are released on a monthly basis for the United States and regions and on a quarterly basis for a variety of other geographies.&#160; Most statistics in the reports reference price changes computed by FHFA's standard&#160;&quot;purchase-only&quot; HPI.&#160; In some cases, however, the reported statistics reference alternative price measures.&#160; FHFA publishes - and makes <a href="/hpi">available for download</a>&#160;- several additional house price indexes beyond the standard &quot;purchase-only&quot; series.&#160; Although they use the same general methodology, the three alternatives rely on slightly different datasets as follows&#58;&#160; &#160;&#160; &#160;<br>&#160; <ul style="list-style-type&#58;disc;"><li>&quot;All-Transactions&quot; house price index.&#160; Appraisal values from refinance mortgages are added to the purchase-only data sample.&#160;<br></li><li>&quot;Expanded-Data&quot; house price index.&#160; Sales price information sourced from county recorder offices and from FHA-backed mortgages are added to the purchase-only data sample.&#160; This index is used to annually adjust the maximum conforming loan limits, which dictate the dollar amount of loans that can be acquired by Fannie Mae and Freddie Mac.&#160;<br></li><li>&quot;Distress-Free&quot; house price index.&#160; Sales of bank-owned properties and short sales are removed from the purchase-only dataset prior to estimation of the index.&#160;<br></li></ul> <br>Data constraints preclude the production of all types of indexes for every geographic area, but multiple index types are generally available.&#160; For individual states, for instance three types of indexes are available. The various indexes tend to correlate closely over the long-term, but short-term differences can be significant.&#160;&#160;&#160;<br><br><br></li><li> <strong><a name="quest4">How often is the FHFA HPI published?</a></strong><br><br>A comprehensive report is published every three months, approximately two months after the end of the previous quarter. Beginning in March 2008, OFHEO (one of FHFA's predecessor agencies) began publishing monthly indexes for census divisions and the&#160;U.S. FHFA continues publishing and updating these indexes each month.<br><br>&#160;</li><li> <strong><a name="quest5">How is the FHFA HPI updated?</a></strong><br><br>Each month, Fannie Mae and Freddie Mac provide FHFA with information on their most recent mortgage transactions. These data are combined with the data from previous periods to establish price differentials on properties where more than one mortgage transaction has occurred. The data are merged, creating an updated historical database that is then used to estimate the FHFA HPI.<br><br>&#160;</li><li> <strong><a name="quest6">How do I interpret &quot;four-quarter,&quot; &quot;one-year,&quot; &quot;annual,&quot; and &quot;one-quarter&quot; price changes?</a></strong><br><br>The &quot;four-quarter&quot; percentage change in home values is simply the price change relative to the same quarter one year earlier. For example, if the FHFA HPI release is for the second quarter, then the &quot;four-quarter&quot; price change reports the percentage change in values relative to the second quarter of the prior year. It reflects the best estimate for how much the value of a typical property increased over the four-quarter period (FAQ #2 reports the types of properties included in this estimate). &quot;One-year&quot; and &quot;annual&quot; appreciation are used synonymously with &quot;four-quarter&quot; appreciation in the full quarterly FHFA HPI releases.<br><br>Similar to the &quot;four-quarter&quot; price changes, the &quot;one-quarter&quot; percentage change estimates the percentage change in home values relative to the prior quarter. Please note that, in estimating the quarterly price index, all observations within a given quarter are pooled together; no distinction is made between transactions occurring in different months. As such, the &quot;four-quarter&quot; and &quot;one-quarter&quot; changes compare typical values throughout a quarter against valuations during a prior quarter. The appreciation rates do not compare values at the end of a quarter against values at the end of a prior quarter.<br><br>&#160;</li><li> <strong><a name="quest7">How are Metropolitan Statistical Areas (MSAs) and Metropolitan Divisions defined and what criteria are used to determine whether an MSA index is published?</a></strong><br><br> MSAs are defined by the Office of Management and Budget (OMB). 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. The following MSAs have been divided into Metropolitan Divisions&#58; Boston-Cambridge-Newton, MA-NH; Chicago-Naperville-Elgin, IL-IN-WI; Dallas-Fort Worth-Arlington, TX; Detroit-Warren-Dearborn, MI; Los Angeles-Long Beach-Anaheim, CA; Miami-Fort Lauderdale-Pompano Beach, FL; New York-Newark-Jersey City, NY-NJ-PA; Philadelphia-Camden-Wilmington, PA-NJ-DE-MD; San Francisco-Oakland-Berkeley, CA; Seattle-Tacoma-Bellevue, WA; Washington-Arlington-Alexandria, DC-VA-MD-WV. For these MSAs, FHFA reports data for each Division, rather than the MSA as a whole.&#160;<br><br>FHFA requires that an MSA (or Metropolitan Division) must have at least 1,000 total transactions before it may be published. Additionally, an MSA or Division must have had at least 10 transactions in any given quarter for that quarterly value to be published. Blanks are displayed where this criterion is not met. <br>&#160; </li><li> <strong><a name="quest8">Does FHFA use the September 2018 revised Metropolitan Statistical Areas (MSAs) and Divisions?</a></strong><br><br>Yes, FHFA uses the revised Metropolitan Statistical Areas (MSAs) and Divisions as defined by the Office of Management and Budget (OMB) in September 2018. The delineations became effective with the 2018Q4 FHFA HPI release in February 2019. These MSAs and Divisions are based on Census data. According to OMB, an MSA comprises the central county or counties containing the core, plus adjacent outlying counties having a high degree of social and economic integration with the central county as measured through commuting. For information about the current MSAs, please visit&#58;<br><br><a href="https&#58;//www.whitehouse.gov/wp-content/uploads/2018/09/Bulletin-18-04.pdf">https&#58;//www.whitehouse.gov/wp-content/uploads/2018/09/Bulletin-18-04.pdf</a><br><br>Previously, FHFA produced metropolitan area indexes based on the February 2013 delineations (and as revised in July 2015, August 2017, and April 2018) and, before that release, the December 2009 delineations provided by the OMB.<br><br>The 2018Q4 FHFA HPI report has a Technical Note which explains the transition to the newest definitions. The accompanying tables are posted on the FHFA HPI Downloadable Data page under the “Additional Data” section then the “Utility Files and Background Information for Index Construction” subsection. Information for the prior delineations are also posted on that page.​ <br> <br></li><li> <strong><a name="quest9">What geographic areas are covered by the FHFA HPI?</a></strong><br><br> The FHFA HPI includes indexes for all nine census divisions, the 50 states and the District of Columbia, and every Metropolitan Statistical Area (MSA) in the U.S., excluding Puerto Rico. OMB recognizes 384 MSAs, 11 of which are subdivided into a total of 31 Metropolitan Divisions.&#160; As noted earlier, FHFA produces indexes for the divisions where they are available, in lieu of producing a single index for the MSA. In total, 404 indexes are released&#58; 373 for the MSAs that do not have Metropolitan Divisions and 31 Division indexes. The starting dates for indexes differ and are determined by a minimum transaction threshold; index values are not provided for periods before at least 1,000 transactions have been accumulated.<br><br>In each release, FHFA publishes rankings and quarterly, annual, and five-year rates of changes for the MSAs and Metropolitan Divisions that have at least 15,000 transactions over the prior 10 years. In this release, 23​1 MSAs and Metropolitan Divisions satisfy this criterion. For the remaining areas, MSAs and Divisions, one-year and five-year rates of change are provided. <br>&#160; </li><li> <strong><a name="quest10">What is the methodology used in computing the FHFA HPI?</a></strong><br><br>The methodology is a modified version of the Case-Shiller® geometric weighted repeat- sales procedure. A detailed description of the FHFA HPI methodology is available upon request at (202) 649-3195 or online at&#58; <a href="http&#58;//go.usa.gov/8BBT"> http&#58;//go.usa.gov/8BBT</a>.<br><br>&#160;</li><li> <strong><a name="quest11">How does the FHFA HPI differ from the Case-Shiller®&#160;Index?</a></strong><br><br>Although both indexes employ the same fundamental repeat-valuations approach, there are a number of data and methodology differences. Among the dissimilarities&#58;</li><ol><li>The Case-Shiller Indexes® only use purchase prices in index calibration, while the all-transactions FHFA HPI also includes refinance appraisals. FHFA's purchase-only series is restricted to purchase prices.</li><li>FHFA's valuation data are derived from conforming mortgages provided by Fannie Mae and Freddie Mac. The Case-Shiller Indexes use information obtained from county assessor and recorder offices.</li><li>The Case-Shiller Indexes are value-weighted, meaning that price trends for more expensive homes have greater influence on estimated price changes than other homes. FHFA's index weights price trends equally for all properties.</li><li>The geographic coverage of the indexes differs. The Case-Shiller National Home Price Index, for example, does not have valuation data from 13 states. FHFA's U.S. index is calculated using data from all states.<br><br>For details on these and other differences, consult the FHFA HPI Technical Description (see <a href="http&#58;//go.usa.gov/8BBT"> http&#58;//go.usa.gov/8BBT</a>) and the Case-Shiller methodology materials (see <a href="http&#58;//us.spindices.com/index-family/real-estate/sp-corelogic-case-shiller"> https&#58;//us.spindices.com/index-family/real-estate/sp-corelogic-case-shiller</a>).<br><br>A paper that analyzes in detail the methodological and data differences between the two price metrics can be accessed at <a href="http&#58;//go.usa.gov/8BBJ"> http&#58;//go.usa.gov/8BBJ</a>.<br><br>&#160;</li></ol><li> <strong><a name="quest12">How does the FHFA HPI differ from the Census Bureau's Constant Quality House Price Index (CQHPI)?</a></strong><br><br>The FHFA HPI covers far more transactions than the Commerce Department survey. The CQHPI covers sales of new homes and homes for sale, based on a sample of about 14,000 transactions annually, gathered through monthly surveys.&#160;The quarterly purchase-only FHFA HPI is based on more than&#160;nine&#160;million repeat transaction pairs over 44&#160;years. This gives a more accurate reflection of current property values than the Commerce Department index. The FHFA HPI also can be updated efficiently using data collected by Fannie Mae and Freddie Mac in the normal course of their business activity.<br><br>&#160;</li><li> <strong><a name="quest13">Where can I access MSA index numbers and standard errors for each year and quarter?</a></strong><br><br>In addition to the information displayed in the MSA tables, FHFA makes available MSA indexes and standard errors. The data are available in ASCII format and may be accessed at <a href="http&#58;//go.usa.gov/8kXz"> http&#58;//go.usa.gov/8kXz</a>.<br><br>&#160;</li><li> <strong><a name="quest14">What role do Fannie Mae and Freddie Mac play in the FHFA HPI?</a></strong><br><br>FHFA uses data supplied by Fannie Mae and Freddie Mac in compiling the FHFA HPI. Each of the Enterprises had previously created a weighted repeat-transactions index based on property matches within its own database. In the first quarter of 1994, Freddie Mac began publishing the Conventional Mortgage Home Price Index (CMHPI). The CMHPI was jointly developed by Fannie Mae and Freddie Mac. The CMHPI series covers the period 1970 to the present.<br><br>&#160;</li><li> <strong><a name="quest15">Why is the FHFA HPI based on Fannie Mae or Freddie Mac mortgages?</a></strong><br><br>FHFA has access to this information by virtue of its role as the federal regulator responsible for these government-sponsored enterprises. Chartered by Congress for the purpose of creating a reliable supply of mortgage funds for homebuyers, Fannie Mae and Freddie Mac are the largest mortgage finance institutions in the U.S. representing a significant share of total outstanding mortgages.<br><br>&#160;</li><li> <strong><a name="quest16">When are the indexes normalized in the downloadable ASCII data?</a></strong><br><br>The ASCII data for metropolitan areas are normalized to the first quarter of 1995. That is, the FHFA HPI equals 100 for all MSAs in the first quarter of 1995. States and divisions are normalized to 100 in the first quarter of 1980. The purchase-only indexes are normalized to 100 in the first quarter of 1991. Note that normalization dates do not affect measured appreciation rates.<br><br>&#160;</li><li> <strong><a name="quest17">Is the FHFA HPI adjusted for inflation?</a></strong><br><br>No, the FHFA HPI is not adjusted for inflation. For inflation adjustments, one can use the Consumer Price Index &quot;All Items Less Shelter&quot; series. The Bureau of Labor Statistics' price index series ID# CUUR0000SA0L2, for example, has tracked non-shelter consumer prices since the 1930s. That series and others can be downloaded at&#58; <a href="http&#58;//data.bls.gov/cgi-bin/srgate"> http&#58;//data.bls.gov/cgi-bin/srgate</a>.<br><br>&#160;</li><li> <strong><a name="quest18">How do I use the manipulatable data (in TXT files) on the website to calculate appreciation rates?</a></strong><br><br>The index numbers alone (for census divisions and U.S., individual states, and MSAs) do not have significance. They have meaning in relation to previous or future index numbers, because you can use them to calculate appreciation rates using the formula below.<br><br>To calculate appreciation between any 2 quarters, use the formula&#58;<br><br>(QUARTER 2 INDEX NUMBER - QUARTER 1 INDEX NUMBER) / QUARTER 1 INDEX NUMBER<br><br>You can generate annual numbers by taking the four quarter average for each year or monthly numbers by finding the difference between two months.<br><br>&#160;</li><li> <strong><a name="quest19">How is the FHFA HPI constructed for MSAs? The website says that FHFA uses the 2018 definitions based on the American Community Survey and Census Bureau population estimates for 2015 to define each MSA. Is this true for all time periods covered by each index? Or do the definitions change over time as the Census expanded its MSA definitions? For example, if the definition of an MSA added three counties between 1980 and 2000, would the value of the index in 1980 cover the three counties that were not included in the 1980 SMSA definition?</a></strong><br><br>The FHFA HPI is recomputed historically each quarter. The MSA definition used to compute the 1982 (for example) index value in Anchorage, AK would be the most recent definition. The series is comparable backwards.<br><br>&#160;</li><li> <strong><a name="quest20">How can the FHFA House Price Index for an MSA be linked to ZIP codes within that MSA?</a></strong><br><br>Although&#160;FHFA has&#160;published experimental house price indexes for some&#160;ZIP codes, those indexes are annual (i.e. quarterly index values are not provided). Researchers needing quarterly values for ZIP codes may be interested in using index values for the applicable metropolitan&#160;area.<br>&#160;<br>Because ZIP codes sometimes overlap county boundaries, a single ZIP code can be located partially inside and outside of a Metropolitan Area. Thus, the development of a crosswalk between ZIP codes and Metropolitan Areas is not a straightforward exercise. The Department of Housing and Urban Development has released a lookup table that maps ZIP codes to the Metropolitan Area(s) that they fall within. That lookup file, as well as a discussion of the underlying technical issues, can be found here&#58; <a href="http&#58;//www.huduser.org/portal/datasets/usps_crosswalk.html">http&#58;//www.huduser.org/portal/datasets/usps_crosswalk.html</a>.<br><br>&#160;</li><li> <strong><a name="quest21">How and why is the FHFA HPI revised each quarter?</a></strong><br><br>Historical estimates of the FHFA HPI revise for three primary reasons&#58;</li><ol><li>The FHFA HPI is based on repeat transactions. That is, the estimates of appreciation are based on repeated valuations of the same property over time. Therefore, each time a property &quot;repeats&quot; in the form of a sale or refinance, average appreciation since the prior sale/refinance period is influenced.<br><br></li><li>Fannie Mae and Freddie Mac (the Enterprises) purchase seasoned loans, providing new information about prior quarters.<br><br></li><li>Due to a 30- to 45-day lag time from loan origination to Enterprise funding, FHFA receives data on new fundings for one additional month following the last month of the quarter. These fundings contain many loans originating in that most recent quarter, and especially the last month of the quarter. This will reduce with subsequent revisions, however data on loans purchased with a longer lag, including seasoned loans, will continue to generate revisions, especially for the most recent quarters.<br><br>In connection with the release of the 2012Q2 FHFA HPI results, a special revision was made to two historical FHFA HPI values. In prior releases, the all-transactions index values for Vermont-1976Q1 and West Virginia-1982Q1 were both reported to be 100.01.&#160;Those values were not correct; index values for those respective periods should have been set to missing because no modeling data were available in the underlying sample. The FHFA HPI releases for 2012Q2 and later periods reflect the change. With the release of the 2019Q1 FHFA HPI results, modeling data became available for Vermont-1976Q1.&#160;The FHFA HPI releases for 2019Q1 and later periods reflect the change.<br><br>&#160;</li></ol><li> <strong><a name="quest22">What transaction dates are used in estimating the index?</a></strong><br><br>For model estimation, the loan origination date is used as the relevant transaction date.<br><br>&#160;</li><li> <strong><a name="quest23">Are foreclosure sales included in the FHFA HPI?</a></strong><br><br>Transactions that merely represent title transfers to lenders will not appear in the data. Once lenders take possession of foreclosed properties, however, the subsequent sale to the public can appear in the data. As with any other property sale, the sales information will be in FHFA's data if the buyer purchases the property with a loan that is bought or guaranteed by Fannie Mae or Freddie Mac.<br><br>&#160;</li><li> <strong><a name="quest24">How are the monthly FHFA HPIs calculated?</a></strong><br><br>The monthly indexes are calculated in the same way the quarterly indexes are constructed, except transactions from the same quarter are no longer aggregated. To construct the quarterly index, all transactions from the same quarter are aggregated and index values are estimated using the assigned quarters. In the monthly indexing model, all transactions for the same month are aggregated and separate index values are estimated for each month.<br><br>&#160;</li><li> <strong><a name="quest25">How are the Census Division and U.S.&#160;FHFA HPIs&#160;formed?</a></strong><br><br>As discussed in the Highlights article accompanying the 2011Q1 FHFA HPI Release (available for download at <a href="http&#58;//go.usa.gov/8k5d">http&#58;//go.usa.gov/8k5d</a>), the census division indexes are constructed from statistics for the component states. For the quarterly all-transactions and purchase-only indexes, the census division indexes are constructed from quarterly growth rate estimates for the underlying state indexes. Census division index estimates are &quot;built-up&quot; from quarterly growth rate estimates (monthly growth rates for the monthly index) for the component states.<br><br>The census division indexes are set equal to 100 in the relevant base periods. Then, the index values for subsequent periods are increased (or decreased) by the weighted average quarterly (or monthly) price change for the underlying states. Index values for periods before the base period are calculated in a similar fashion; beginning with the base period value, the preceding index values are sequentially determined so that the growth rate in each period always reflects the weighted average growth rate for the component states.<br><br>The national FHFA HPI is constructed in an analogous fashion, except that the weighted components are census divisions. Because the census divisions measures are themselves weighted averages of state metrics, the U.S. index is equivalent to a state-weighted metric.<br><br>&#160;</li><li> <strong><a name="quest26">What weights are used in forming the Census Division and U.S. FHFA HPIs?</a></strong><br><br>The weights used in constructing the indexes are estimates for the shares of one-unit detached properties in each state.&#160; For years in which decennial census data are available, the share from the relevant census is used. For intervening years, a state’s share is the weighted average of the relevant shares in the prior and subsequent censuses, where the weights are changed by ten percentage points each year.&#160;For example, California’s share of the housing stock for 1982 is calculated as 0.8 times its share in the 1980 census plus 0.2 times its share in the 1990 census. For 1983, the Pacific Division’s share is 0.7 times its 1980 share plus 0.3 times its 1990 share.&#160;<br><br>For years since 2000, state shares are calculated as follows&#58;<br><br> <ul><li>For the 2001-2005 interval, shares are straight-line interpolated based on the state shares in the 2000 decennial Census and the 2005 values from the American Community Survey (ACS).</li><li>For 2006-2017, the estimates are from the annual ACS.</li><li>Until 2018 ACS estimates become available, shares from the 2017 ACS are used for subsequent periods.<br></li></ul> <br> </li><li> <strong><a name="quest27">For those HPIs that are seasonally adjusted, what approach is used in performing the seasonal adjustment?</a></strong><br><br>The Census Bureau's X-12 ARIMA procedure is used, as implemented in the SAS software package. The automated ARIMA model-selection algorithm in X-12 is employed, which searches through a series of seasonality structures and selects the first that satisfies the Ljung-Box test for serial correlation.<br>&#160;<br>To obtain more information on the FHFA HPI contact us via the Data and Research Contact page at <a href="http&#58;//go.usa.gov/8kN3">http&#58;//go.usa.gov/8kN3</a>.<br><br>&#160;</li><li> <strong> <a name="quest28">Do you have an FHFA HPI that includes loans which are not purchased or securitized&#160;by Fannie Mae or Freddie Mac?</a></strong><br><br>Yes, the expanded-data index includes purchase-money mortgages from other sources.&#160;The approach to estimating the expanded-data HPI is detailed in the Highlights article published with the 2011Q2 FHFA HPI at <a href="http&#58;//go.usa.gov/8kNm"> http&#58;//go.usa.gov/8kNm</a>. In general, the methodology is the same as is used in the construction of the standard purchase-only FHFA HPI, except a supplemented dataset is used for estimation. The augmented data include sales price information from Fannie Mae and Freddie Mac mortgages as well as two new information sources&#58; (1) transactions records for houses with mortgages endorsed by FHA and (2) county recorder data licensed from CoreLogic. The licensed county recorder data do not include records in many U.S. counties—particularly rural ones. To ensure that the addition of the CoreLogic data to the estimation sample does not unduly bias index estimates toward price trends in urban areas, the expanded-data index for certain states is estimated by weighting price trends in areas with CoreLogic coverage and other areas. Details on this sub-area weighting can be found in the text of the Highlights piece referenced above.<br><br>&#160;</li><li> <strong><a name="quest29">Is there an FHFA HPI that corrects for distressed sales?</a></strong><br><br>FHFA released a &quot;distress-free&quot; HPI in 2012Q2 along with the Highlights article at <a href="http&#58;//go.usa.gov/8kNJ"> http&#58;//go.usa.gov/8kNJ</a>. The index is a version of the purchase-only index that removes short sales and sales of bank-owned properties from the transactions data used to compute that traditional index. The index is still in a developmental stage. An analysis of how distressed sales affect the FHFA HPI is provided in an FHFA Working Paper released August 2013 at <a href="http&#58;//go.usa.gov/8kRB"> http&#58;//go.usa.gov/8kRB</a>.&#160;<br><br><br></li><li> <strong><a name="quest30">Can I use the data in the FHFA&#160;HPI and, if so, how should the index be cited?</a></strong>&#160;<br><br>Yes. The FHFA HPI data are freely available for download at <a href="/hpi">https&#58;//www.fhfa.gov/hpi</a>. To cite the index in an article or story, we suggest at least an attribution like &quot;Source&#58; FHFA HPI&quot; or &quot;Source&#58; Federal Housing Finance Agency House Price Index (HPI)&quot;. Additional clarifications could be helpful to denote the type of index (purchase-only, all-transactions, expanded-data) and whether the data are adjusted for seasonality or inflation. A more&#160;detailed citation might be &quot;Source&#58; FHFA HPI (purchase-only, seasonally-adjusted, nominal)&quot;.<br><br> <a href="/Media/PublicAffairs/PublicAffairsDocuments/FHFA-HPI-FAQs_11262019.pdf"> <strong>FHFA HPI FAQs (PDF) as of 11/26/2019</strong></a><br></li></ol>5/30/2023 1:01:22 PMHome / Media / FHFA House Price Index Frequently Asked Questions X Search FAQs   mail icon Contact Data and Research Contact Form download icon Download PDF 58013https://www.fhfa.gov/Media/PublicAffairs/Pages/Forms/AllItems.aspxhtmlFalseaspx
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