Danville, IL Federal Housing Finance Agency Home Price Index (FHFA HPI)

The Danville, IL, Federal Housing Finance Agency (FHFA) House Price Index (HPI) is a weighted, repeat-sales index that measures average price changes in repeat sales or refinancings on the same properties. The index covers single-family homes and condominiums. The Danville HPI value is a weighted average of transactions involving conforming conventional mortgages purchased or securitized by Fannie Mae or Freddie Mac.

As of the fourth quarter of 2019, the Danville HPI was 176.9, down 0.2 percent from the previous quarter and up 1.3 percent from one year earlier. On a year-over-year basis, home prices in Danville have increased for nine consecutive quarters but at a slower pace compared to other periods during the housing market recovery. From its peak in the second quarter of 2006 to its trough in the first quarter of 2012, the Danville HPI fell by 30 percent. Since then, prices have recovered by more than half and are now just 14 percent below their pre-crisis peak levels (see chart 1).

Chart 1: Danville Home Prices Have Recovered More Than Half of Their Pre-Crisis Losses

The recent slowdown in home price growth appears to be driven by several factors including:

1) Rising mortgage rates which reduce affordability and may price some buyers out of the market;

2) A decrease in foreign investment as concerns about potential changes to U.S tax policy make investing here less attractive; and

3) Limited inventory which constrains choice for buyers and puts upward pressure on prices.