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Friday, January 07, 2022  01:00 PM  (54)

Pittsburgh real estate values rising their fastest since the 1970s

According to data compiled by the Federal Housing Finance Agency (FHFA), residential housing prices in the Pittsburgh metropolitan statistical area (MSA) are increasing at the fastest rate since the 1970s. In the 3^rd quarter of 2021, Pittsburgh region housing prices jumped by 13.4% compared to the year prior, the fastest year-over-year appreciation since the 1^st quarter of 1979. When adjusted for inflation, Pittsburgh-region real estate prices went up by 7.7% over the same period, the largest year-over-year increase since the 3^rd quarter of 1978.

The data here is compiled from the FHFA All-Transaction Index of real estate values which is based on mortgage data from Fannie Mae and Freddie Mac, the primary government-sponsored corporations that securitize mortgages in the secondary market. The two government enterprises typically acquire the majority of mortgages in the United States. The FHFA All-Transaction Housing Price Index (HPI) is compiled using seasonally-adjusted data on real estate purchases from Fannie Mae and Freddie Mac, supplemented by appraisal data from mortgage refinancing.*

Despite the historic rise in the Pittsburgh region’s real estate values, local gains trail even faster appreciation in real estate prices across the nation. In the 3^rd quarter of 2021, the FHFA All-Transaction index estimates that national real estate prices increased by 16.4% over the previous year (10.5% after adjusting for inflation). An alternative index, the FHFA Purchase-Only Housing Price Index recorded an 18.5% year-over-year gain in the 3^rd  quarter of 2021, the highest ever recorded in the FHFA quarterly data series with increases being recorded in all states and metropolitan areas. 

The FHFA quarterly data was adjusted for inflation using a quarterly average of the Consumer Price Index for All-Urban Consumers (CPI-U). Regional data is for the seven-county Pittsburgh MSA which is comprised of Allegheny, Armstrong, Beaver, Butler, Fayette, Washington and Westmoreland counties in southwestern Pennsylvania. FHFA Housing Price Indices are available at: https://www.fhfa.gov/DataTools/Downloads/Pages/House-Price-Index-Datasets.aspx#qat.

* The FHFA All-Transaction Housing Price Index is just one of several real estate indexes compiled by the FHFA. The FHFA Purchase-Only Housing Price Index – which does not use appraisal values from mortgage refinancing – recorded a 13.0% year-over-year increase in Pittsburgh MSA real estate values and an 18.5% year-over-year increase in values nationally in the 3^rd quarter of 2021. 

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