OFHEO: House Prices Rose 5.9% in '06

Single-family house prices increased by 5.9% in 2006, but the rate of increase has slowed considerably from 13.2% in 2005, when the housing market was booming, according to new Office of Federal Housing Enterprise Oversight data.The OFHEO House Price Index also shows that appreciation increased by 1.1% in the fourth quarter and 1.03% in the third quarter. House prices are still rising but are now "more in line with historical norms," OFHEO Director James Lockhart said. Separately, the S&P/Case-Shiller House Price Indices released Feb. 27 indicate that house prices declined in 20 metropolitan areas by 0.4% in 2006. Some economists are coming to view the Case-Shiller HPI as more representative of housing price trends than OFHEO's because they track all purchase transactions. The OFHEO index includes refinancings and is limited to transactions involving conventional conforming loans purchased by Fannie Mae and Freddie Mac.