First American’s proprietary Real House Price Index (RHPI) looks at May 2016 data and includes analysis from First American Chief Economist Mark Fleming explaining the forces behind the continued low mortgage rate environment and the impact on consumer house-buying power.

“Rising household incomes and falling mortgage rates are currently boosting consumer house-buying power in many major metropolitan markets, offsetting any nominal gains in price levels. Improving affordability for consumers is a direct result of increased demand for long-term U.S. Treasury bonds due to overall uncertainty surrounding the future of global markets,” said Mark Fleming, chief economist at First American. 

“Rising household incomes and falling mortgage rates are currently boosting consumer house-buying power in many major metropolitan markets, offsetting any nominal gains in price levels.”

The RHPI offers an alternative view of the change over time of house prices at the national, state and metropolitan area level. It measures the price changes of single-family properties throughout the U.S. adjusted for the impact of income and interest rate changes on consumer house-buying power. Because the RHPI adjusts for house-buying power, it is also a measure of housing affordability.

For Mark’s full analysis on affordability, the top five states and markets with the greatest increases and decreases in real house prices, and more, please visit the Real House Price Index.

The RHPI will be updated monthly with new data, so look for the next edition of the RHPI on August 22.