Decatur, AL Federal Housing Finance Agency Home Price Index (FHFA HPI)

The Decatur, AL, 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 was created in order to be a more accurate measure of house price changes than other methods, such as the Case-Shiller Index.

As of December 2020, the FHFA HPI for Decatur was 176.7, up from 174.1 in November 2020 and 170.8 in October 2020. This represents a 2.6% increase in house prices from November to December 2020 and a 3.9% increase from October to December 2020.

There are several factors that have contributed to the recent increases in home prices in Decatur:

1) Low interest rates: Interest rates have been at historically low levels since March 2020 due to actions taken by the Federal Reserve in response to the COVID-19 pandemic. These low interest rates make it cheaper for people to borrow money for a home purchase or refinance, which leads to more demand for homes and higher prices.

2) Limited supply of homes: The number of homes available for sale has been declining since early 2019 due to a combination of factors including builders not constructing enough new homes to meet demand and people choosing to stay put and remodel their existing homes instead of selling them and moving into something new. This limited supply is leading to increased competition among buyers and driving up prices.

3) Strong job market: The Decatur metro area has seen strong job growth over the past year, with an unemployment rate of just 3% as of November 2020 according to the Alabama Department of Labor. A strong job market gives people confidence about their future income and makes them more likely to buy a home now rather than wait until later when they may not be able afford as much house due their income increasing over time.