Home Prices Rise, Mortgage Delinquencies Fall Across Most Eighth District States In 4Q 2012

ST. LOUIS –  House prices in five of the seven states that comprise the Federal Reserve's Eighth District continued to rise during the fourth quarter 2012, with prices rising the most in Arkansas both quarter-over-quarter and year-over-year, according to the St. Louis Fed’s latest Housing Market Conditions report.  

The Eighth District states are comprised of Arkansas, Illinois, Indiana, Kentucky, Mississippi, Missouri and Tennessee.*

The quarterly HMC report provides a snapshot of conditions in the U.S. and in the Eighth District states via color-coded heat maps that reflect the number of mortgages considered seriously delinquent (i.e., those that are delinquent 90 days or more, or are in foreclosure) and the respective quarterly percent change in these numbers by county for the U.S. and by zip code for each state. In addition, each report contains a listing of the top 10 zip codes with mortgages under stress in each Eighth District state, along with historical house price index charts for the U.S. and for each Eighth District state.

Quarterly and Yearly Housing Price Performance

From the third quarter 2012 to the fourth quarter 2012, Arkansas home prices were up 1.4 percent, compared with 1.6 percent nationally. From fourth quarter 2011 to fourth quarter 2012, Arkansas prices were were up 5.7 percent, compared with 5.4 percent nationally.

In the rest of the District, quarter-over-quarter prices rose 0.7 percent in Indiana, 0.1 percent in Kentucky, 0.3 percent in Missouri and 0.9 percent in Tennessee. Meanwhile, Illinois prices declined 0.4 percent, and Mississippi prices were unchanged.

Year-over-year prices rose 3.8 percent in Indiana, 2.6 percent in Kentucky, 1.1 percent in Mississippi, 2.7 percent in Missouri and 2.6 percent in Tennessee. Illinois was the only state in the District where prices were down both quarter-over-quarter and year-over year.

Peak-to Current House Price Performance

Prices from the peak of the housing market in the first half of 2007 to the fourth quarter of 2012 were down 31.2 percent in Illinois, 7 percent in Indiana, 4.4 percent in Kentucky, 14.4 percent in Mississippi, 17.1 percent in Missouri and 13.9 percent in Tennessee. Nationally, peak-to-current prices were down 21.1 percent.

Bottom-to-Current House Price Performance

From pricing bottoms reached in 2011, Illinois prices remained flat as of the fourth quarter 2012, while all other Eighth District states rose.  Indiana was up 4.6 percent; Kentucky, up 3 percent; Missisissippi, up 1.8 percent; Missouri, up 2.7 percent and Tennessee, up 2.8 percent. Nationally, bottom-to-current prices were up 5.5 percent.

Seriously Delinquent Mortgages

The number of seriously delinquent home mortgages (90-plus days overdue, or in foreclosure) fell in all Eighth District states in the fourth quarter, with the exception of Arkansas, where delinquencies rose 14 basis points. Meanwhile, delinquencies fell 53 basis points in Illinois, 28 basis points in Indiana, 32 basis points in Kentucky, 10 basis points in Mississippi, 19 basis points in Missouri and 25 basis points in Tennessee. Nationally, delinquencies fell 33 basis points.

Meanwhile, the percentage of seriously delinquent levels was below the national average of 6.6 percent in Arkansas, Kentucky, Missouri and Tennessee, with average rates of 6.36 percent, 5.26 percent, 4.09 percent and 5.45 percent respectively. Levels remained above the national average in Illinois, Indiana and Mississippi. with rates of 8.83 percent, 6.7 percent and 8.44 percent respectively.

Indeed, Illinois, the Eighth District state with the highest peak-to-current price level decline, was also the Eighth District state with the highest percentage of seriously delinquent loans.

* Please note: While the Eighth District is comprised of the entire state of Arkansas and only parts of Illinois, Indiana, Kentucky, Mississippi, Missouri and Tennessee, analysis is conducted on a statewide basis for each state's respective report.