Figuring Home Appreciation

“I Am From The Government And I Am Here To Help You”
by Craig Goebbel
President & CEO, LoanTek, Inc.

Seattle, February 7, 2004  -  Is your home in Olympia appreciating more or less than a similar home in Seattle? Figuring out how much the average home gained in value in any metropolitan area can be closely estimated using an index that is freely available on a government website.

The index is published at the Office of Federal Housing Enterprise Oversight and is easy to use for those who know the steps.

For example, to find out how much houses in our regions three area MSA’s; Seattle-Bellevue-Everett; Tacoma;, and Olympia grew in value, quarter by quarter during 2002, here are the steps:

1. Go to the Office of Federal Housing Enterprise Oversight’s website, www.ofheo.gov/HPI.asp, and click on "Metropolitan Statistical Areas."
    
2. Scroll down to select “Seattle-Bellevue-Everett, Tacoma, Olympia"
    
3. Click “search.”
    
4. Annual appreciation rates for the entire index series will be displayed.

Data are available through the third quarter of 2003.

This site covers all of the MSA’s in the country so it is a good site to check out if you are wondering about the appreciation trends in area’s you may be considering for retirement or a second home.

To determine how much Seattle-Bellevue-Everett homes appreciated from 1992 to 2002, follow these steps:

1. Go to www.ofheo.gov/HPI.asp.
    
2. Select "Downloadable HPI Data."
    
3. From the next menu, select "Manipulatable data for the MSAs." Data are available as a TXT file or as an EXCEL file, which can be downloaded to a spreadsheet. (This file is very large because it includes every metro area in the country so beware unless you have broadband or cable access.
    
4. Scroll down to the data for Seattle-Bellevue-Everett for fourth quarter 2002 (161.92), then for fourth quarter 1992 (95.93).
    
5. To calculate the percentage change between these two appreciation rates, subtract the 1992 figure from the 2002 figure: 161.92 - 95.93 = 65.99.
    
6. Then divide the difference (65.99) by the 1992 index value (95.93) and express as a percent:: 65.99 / 95.93 = .6879 or 68.79%.

Homes in the Seattle-Bellevue-Everett area increased by 68.79% in value during that period.

I have surfed in the OFHEO website and it is full of useful information for the real estate curious or true industry geeks like myself.

This is one place where the phrase “I Am From The Government And I Am Here To Help You” really is true!

© 2004 LoanTek

Craig Goebbel is President and CEO of LoanTek.com, mortgage loan brokerage.  He is also producer and host of Real Estate Radio Show, a Seattle-based talk show featuring mortgage and real estate news, interviews and listener calls. It is broadcast on KVI Radio AM 570 in Seattle, Washington. Past show are also webcast via the Internet at http://www.realestateradio.net.

Real Estate Radio Sponsor

Real Estate Radio with Goebbel and Gray is the leading real estate radio talk show in the world and is hosted by Real Estate home mortgage expert Craig Goebbel, owner of LoanTek Home Loans and Robb Gray of John L. Scott Real Estate.