Home prices up 12.5 percent over past year
Home values appreciated 2.2 percent during the first quarter from the fourth quarter of 2004, or at an annual rate of 8.8 percent.
"The House Price Index shows the rise in house prices continues at an extremely strong pace and raises the potential for declines in some areas later on," said Patrick Lawler, chief economist for the federal financial regulator of mortgage finance companies Fannie Mae and Freddie Mac.
The 12.5 percent increase in home prices over the past year marked the biggest four-quarter jump since the third quarter of 2004, when appreciation surpassed any increase recorded in more than 25 years, OFHEO said.
Lawler cited low interest rates, income growing and "the apparent impact of speculation" in some markets for the sustained gains in home prices.
The biggest price increases in the index over the past year were in Nevada, with a four-quarter jump of 31 percent, OFHEO said. California, with a 25 percent price increase, overtook Hawaii to become the state with the second-quickest house price appreciation.
Washington, D.C., came in fourth, with prices up 22 percent over the year.
The smallest increases occurred in Colorado, Ohio, Oklahoma, Indiana and Texas, OFHEO said.
No states posted declines.