Will California’s seasonally adjusted Purchase-Only HPI for Q4 2026 be above 419.85?

- [2026-05-26] FHFA's 2026Q1 report shows California's seasonally adjusted Purchase-Only HPI rose 0.18% quarter-over-quarter and fell 0.54% year-over-year, ranking California 47th of 51 states/DC for the period ended 2026Q1 , with the index roughly 420.6 on a 1991Q1=100 base, consistent with the 419.85 strike for Q4 2025. Source: https://www.fhfa.gov/document/d/hpi/fhfa-house-price-index-report-2026q1 - [2026-08-25] FHFA's 2026Q2 report shows California fell 0.20% quarter-over-quarter and 0.62% year-over-year, with a 5-year gain of 17.31% and 317.15% since 1991 , placing California 48th nationally for the period. This implies the Q2 2026 SA index is essentially flat to very slightly below the Q4 2025 (419.85) baseline. Source: https://www.fhfa.gov/document/d/hpi/fhfa-house-price-index-report-2026q2 - [2026-08-25] At the national level, U.S. house prices rose 2.1 percent between Q2 2025 and Q2 2026, and 0.3 percent from Q1 2026 to Q2 2026 , but California specifically edged down 0.2% while Washington and Colorado also declined on a Q2 2026 quarter-over-quarter basis. - [2026-09-01] Commentary on the Q2 2026 release noted that four states posted year-over-year declines in their HPI, led by New Mexico, followed by Washington, Colorado and California , confirming California is one of the weakest-performing states in the current cycle. - [2026-08-25] The Pacific census division (which includes California) rose only slightly above 0.0% year-over-year, the weakest of all nine census divisions through Q2 2026, underscoring persistent softness in CA/West Coast housing relative to the rest of the country. - [2026-10-11 as of today] The most recent FHFA quarterly data available is for 2026Q2 (released 2026-08-25). No Q3 2026 or Q4 2026 state-level data exists yet. FHFA will release the next quarterly report, covering Q3 2026, on November 24, 2026 , and the Q4 2026 quarterly index is scheduled for release on Tuesday, February 23, 2027 — which coincides with this contract's stated close date of 2027-02-23. - [2026-10-11] Because the official Q4 2026 release lands on the same day the market closes, resolution will depend entirely on that single data release; there is no buffer period for revisions or re-checking before the contract must resolve. - [2026-08-25] Chained quarter-over-quarter changes from the strike (419.85 at Q4 2025) through Q1 2026 (+0.18%) and Q2 2026 (-0.20%) imply a CA SA index of roughly 419–421 as of mid-2026 — i.e., essentially flat versus the Q4 2025 baseline, with no clear upward momentum established through the most recent two quarters of confirmed data. - [2026-10-11] Separately, FRED's not-seasonally-adjusted CA purchase-only series (a different, NSA vintage) showed a current level of 421.93, up from 418.09 last quarter and down from 424.05 one year ago, a change of 0.92% from last quarter and -0.50% from one year ago as of Q1 2026 — broadly corroborating the flat/slightly-negative trend seen in the official SA purchase-only series, though this specific NSA series is not the index_sa series the contract resolves on. BOTTOM LINE: The last two confirmed FHFA quarterly SA Purchase-Only HPI prints for California (Q1 2026: +0.18% q/q; Q2 2026: -0.20% q/q, -0.62% y/y) show the index essentially flat and slightly underperforming versus the national trend, implying California's index was hovering very close to (and arguably just below) the 419.85 Q4-2025 baseline as of mid-2026, with no Q3/Q4 2026 data yet available to confirm whether it breaks meaningfully above that level by year-end. NOT FOUND: The exact numeric seasonally adjusted California index level (not just percent changes) for Q4 2025, Q1 2026, or Q2 2026 could not be directly retrieved from a state-level index-value table (FHFA's published state tables show only percent changes, not point levels); Q3 2026 and Q4 2026 California data do not yet exist and will not be published until November 24, 2026 and February 23, 2027, respectively.

- [2026-08-25] FHFA's official 2026Q2 Quarterly Report (Purchase-Only HPI, Seasonally Adjusted) shows California's recent quarterly trajectory has been negative: California (CA), Rank 48, posted a -0.20% one-year change and -0.62% quarterly change as of 2026Q2 , placing CA among only a handful of states with falling prices (joined by Colorado, Washington, New Mexico). https://www.fhfa.gov/document/d/hpi/fhfa-house-price-index-report-2026q2 - [2026-05-26] The prior quarterly release (2026Q1) showed California just barely positive quarter-over-quarter but already negative year-over-year: California ranked 47th with 1-Quarter change 0.18% and 1-Year change -0.54% , confirming CA had already entered a soft patch before the strike's baseline quarter even closed out its first follow-on quarter. https://www.fhfa.gov/data/hpi/summary-tables - [2026-08-25] The U.S. national base rate for this type of event is historically very high: U.S. house prices rose 2.1 percent year over year and 0.3 percent quarter over quarter as of 2026Q2, with national annual appreciation positive every quarter since the start of 2012 — but California has decoupled from this reliably-positive national pattern since late 2025/early 2026. https://www.fhfa.gov/document/d/hpi/fhfa-house-price-index-report-2026q2 - [2026-08-25] At the metro level within California the picture is mixed-to-negative: Riverside-San Bernardino-Ontario -0.77% 1-yr, Sacramento-Roseville-Folsom -0.25% 1-yr, San Francisco-San Mateo-Redwood City -2.42% 1-yr with a sharp -9.09% quarterly drop, and San Jose-Sunnyvale-Santa Clara -1.62% 1-yr , while only a few CA metros (Anaheim-Santa Ana-Irvine +2.25%, San Diego +0.26%) stayed modestly positive — showing the statewide softness is broad-based, not a single-metro anomaly. https://www.fhfa.gov/document/d/hpi/fhfa-house-price-index-report-2026q2 - [2024-02-25] Looking back further for base-rate context, a year earlier California was still appreciating: the 2024Q4 report showed California (CA) ranked 46th with a 2.15% annual and 0.48% quarterly increase , illustrating that CA's shift from modest growth to outright year-over-year decline is a relatively recent (2025–2026) development, not a long-run pattern. https://www.fhfa.gov/document/FHFA-HPI-Quarterly_02252025.pdf - [2026-09-xx] An independent trade-group forecast (not FHFA-index-specific but directionally relevant) expects modest statewide appreciation in 2026: California home sales are forecast to inch up in 2026, with the median home price expected to reach a new projected record of $905,000 , and C.A.R.'s president noted "Home prices in California are expected to rise in 2026, but the growth pace will remain mild when compared to rates we've seen in past years." This CAR figure tracks median *sale* price (not the repeat-sales FHFA index) and was published before the FHFA data showed CA's YoY turning negative. https://www.car.org/aboutus/mediacenter/newsreleases/2025releases/2026forecast - [2026-09-16] A more recent, higher-frequency C.A.R. reading shows essentially flat year-over-year pricing in mid-2026: the statewide existing single-family median rebounded to $901,420—up 1.6% from July's $887,210 and just 0.1% above August 2025's $900,620 , consistent with the FHFA index's near-zero/slightly-negative YoY reading and suggesting the "above strike" outcome is a close call rather than a clear trend in either direction. https://www.noradarealestate.com/blog/california-housing-market/ - [2026-09-xx] A regional-market report corroborates the softening-then-stabilizing narrative for Southern California: Southern California home prices declined 1-3% across major metros in 2025 but are forecast to rise 1-2% in 2026 , with analysts suggesting "Late 2025 and early 2026 could be the lowest price point of the current cycle." If correct, this would argue for stabilization/modest recovery by Q4 2026, supporting a "Yes" outcome, but this is a qualitative industry forecast, not derived from the FHFA repeat-sales index itself. https://homebuyinginstitute.com/mortgage/southern-california-housing-market/ - [2026-09-xx] A separate regional metro-forecast source projects only very small gains for major CA metros in 2026 (e.g., LA +1.3%, San Diego +2.1% ; Sacramento +0.2% ), implying the margin above/below the Q4-2025 baseline is likely to be thin either way, consistent with a close-to-the-line resolution. BOTTOM LINE: Nationally, YoY house-price gains have been positive in essentially every quarter since 2012 (a very high base rate for "Yes"-type outcomes), but California itself has recently broken from that pattern — the FHFA SA Purchase-Only index showed CA's YoY change turn negative in both 2026Q1 (-0.54%) and 2026Q2 (-0.20%), with an accelerating quarterly decline (-0.62%) in Q2 2026 — while industry forecasts (C.A.R.) still expect mild appreciation to resume later in 2026, making the comparison to the 419.85 (Q4-2025) baseline a close, trend-dependent call rather than a high-confidence "Yes" based on historical patterns alone. NOT FOUND: The exact FHFA state-level seasonally-adjusted index value (index_sa) for California in Q4 2025 or any quarter of 2026 could not be directly retrieved (only percent-change tables were accessible; the raw quarterly state-level SA dataset file returned as an unsupported XLSX format and the master CSV was too large to fetch in full), so I could not independently confirm the exact 419.85 strike value or compute precise distance-to-strike for Q2 2026.

YES means: FHFA's seasonally adjusted Purchase-Only HPI for California in 2026Q4 (to be published 2027-02-23) prints above 419.85, the Q4-2025 baseline. - [2026-10-08] Los Angeles County single-family homes (the state's largest county market) show clear price acceleration: "Los Angeles County single-family homes sold for an average of $1,551,572 in the third quarter of 2026 (July through September), up 8.0% from $1,436,531 in Q3 2025." Year-to-date through September, "23,660 single-family homes closed, up 13% from the same months of 2025, and the average price rose 13% to $1,528,775." This is a live, post-Q2 (not yet in FHFA's repeat-sales index) signal that at least one major CA submarket strengthened materially into Q3, which is the quarter immediately preceding the Q4 2026 print. - [2026-09-16] C.A.R.'s statewide existing single-family median, a higher-frequency read than FHFA's quarterly index, moved back into positive YoY territory in August: the median "rebounded to $901,420—up 1.6% from July's $887,210 and just 0.1% above August 2025's $900,620" , reversing the negative YoY trend seen in FHFA's Q1/Q2 data. - [2026-09-16] Sales volume also improved, a leading indicator for price momentum: "Seasonally adjusted annualized sales reached 269,620, up 2.4% from July and 1.4% from a year earlier" . - [2026-09-xx] North Coast Financial's independently compiled market analysis confirms California's Zillow Home Value Index for the state had already turned positive year-over-year by late summer: the state's "California Zillow home value index $764,158, +0.4% YoY (Aug 31, 2026)" — a second independent repeat-sales-adjacent index showing the state above a year ago, not below. - [2026-09-xx] The same report notes California closed the buying season firmer than mid-year readings implied: "California closed the buying season firmer than July suggested. The C.A.R. statewide median for an existing single-family home rose to $901,420 in August, up 1.6% from a revised $887,210 in July, ahead of the typical July-to-August gain of 1.2%" . - [2026-09-30] Even a bearish-framed recap of federal data (FHFA/Case-Shiller-style) concedes California is still in positive YoY territory, not negative: "California home prices climbed a mere 0.9% over the 12 months through June, the third-weakest annual gain of any state in the country, according to figures highlighted in a report from the San Diego Union-Tribune." A positive (if small) YoY reading through June, if it persists or strengthens with the LA County and C.A.R. August/September upticks, is consistent with California's FHFA SA index sitting above its year-ago (Q4 2025) level by Q4 2026. - [2026-09-17] C.A.R.'s official annual forecast, issued before the softer FHFA prints, still projects renewed statewide appreciation for calendar 2026: "California home sales are forecast to inch up in 2026, with the median home price expected to reach a new projected record of $905,000... The California median home price is forecast to rise 3.6 percent to $905,000 in 2026." If August–September momentum (LA County +8%, statewide median +1.6% m/m) continues into Q4, this forecast trajectory supports a push back above the 419.85 baseline. - [2026-10-xx] Mechanism/path to YES: California's FHFA SA index was essentially flat to marginally below baseline through Q2 2026 (per prior reports), but the subsequent higher-frequency C.A.R. and county-level MLS data for July–September 2026 show renewed m/m and y/y gains (C.A.R. +1.6% m/m in August; LA County +8.0% y/y in Q3) — if this reacceleration carries through October–December and is captured in FHFA's repeat-sales methodology, it would lift the Q4 2026 index back above the Q4 2025 baseline, delivering a YES. - [2026-10-xx] Countervailing risk acknowledged: mortgage rates rose sharply into October 2026 (30-year averaging in the high-6%-to-7%+ range per multiple trackers), which could cap any price reacceleration; however, the LA County and C.A.R. data above represent actual closed transactions through September, already reflecting the higher-rate environment, and still show positive momentum. BOTTOM LINE: The strongest case for YES rests on a reacceleration in California home prices visible in higher-frequency, more current data (C.A.R. statewide median and LA County MLS) through August–September 2026 — both turning positive year-over-year after the FHFA index's Q1–Q2 2026 softness — suggesting the index could cross back above the fixed 419.85 (Q4 2025) baseline by Q4 2026 if this momentum holds through year-end, though this is not yet confirmed by any FHFA data, which will not be available until February 23, 2027. NOT FOUND: No official FHFA, Case-Shiller, or CoreLogic Q3 2026 or Q4 2026 California index reading exists yet (FHFA Q3 2026 due 2026-11-24; Q4 2026 due 2027-02-23); no source converts the recent positive C.A.R./LA-County momentum directly into a projected FHFA Purchase-Only SA index point value for Q4 2026.

YES means: FHFA's official Q4 2026 seasonally-adjusted Purchase-Only HPI for California (index_sa, released Feb 23, 2027) prints above 419.85, i.e., the index ends 2026 higher than the Q4 2025 baseline despite two already-confirmed soft-to-negative quarters (Q1 and Q2 2026). - [2026-09-16] C.A.R.'s own August 2026 report shows the statewide median per-square-foot price (a less mix-sensitive gauge than headline median) fell 1.4% on the month and is up only 0.2% year-over-year, indicating "underlying appreciation is close to zero" even as the headline median ticked up seasonally. https://www.northcoastfinancialinc.com/california-real-estate-market-analysis-september-2026/ - [2026-09-16] The C.A.R. Unsold Inventory Index for California climbed to 3.7 months in August, its highest in six months, while median days on market lengthened to 28 (from 26 in July, 31 a year ago) — supply loosening faster than demand, a classic pre-softening signal heading into Q4. https://www.northcoastfinancialinc.com/california-real-estate-market-analysis-september-2026/ - [2026-09-16] The Federal Reserve raised its target range a quarter point to 3.75%–4.00% on September 16, 2026, its first hike of this cycle, with 16 of 18 participants penciling in at least one more hike before year-end — a materially more restrictive rate path than markets had priced for late 2026. https://www.northcoastfinancialinc.com/california-real-estate-market-analysis-september-2026/ - [2026-09-17] Following the Fed decision, the 30-year fixed mortgage rate jumped to 6.95% in the September 17 Freddie Mac survey, the highest weekly reading since January 2025, up roughly 90 basis points from February's 6.05% cycle low — directly raising financing costs for the Q4 2026 purchase-money transactions that will set the Q4 2026 HPI print. https://www.northcoastfinancialinc.com/california-real-estate-market-analysis-september-2026/ - [2026-09-16] The same report's explicit "Key Risk" flags that if the Fed's late-October meeting delivers a second hike, the 30-year fixed "likely holds above 7% into the winter, exactly when California's seasonal price softening runs deepest" — directly covering the Q4 2026 measurement window. https://www.northcoastfinancialinc.com/california-real-estate-market-analysis-september-2026/ - [2026-10-07] C.A.R.'s newly released 2027 forecast (published Oct. 7, 2026) quietly cut its own 2026 full-year median-price call to just a 0.8% annual gain to $882,200, down sharply from the 3.6%/$905,000 gain it had projected a year earlier — a material downward revision to the same-year outlook made with three quarters of actual 2026 data in hand. https://www.car.org/aboutus/mediacenter/newsreleases/2026releases/2027housingforecast - [2026-10-07] That October 7 forecast also shows projected 2026 annual home sales of 268,100 units, down 1.1% from 2025's 271,100 — the first annual sales decline C.A.R. projects since 2022 — while explicitly citing persistent "locked-in homeowners, locked-out buyers" dynamics and expectations that mortgage rates "will remain in the 7% range next year before improving in 2028." https://www.calhomenews.com/2026/10/07/locked-in-homeowners-locked-out-buyers-housing-market-to-stay-stuck-in-2027/ - [2026-09-30] A roundup of federal/industry data reported that California home prices rose just 0.9% over the year through June, ranking third-weakest nationally, reinforcing that CA has been a bottom-tier appreciator even before the September rate shock hit. https://hoodline.com/2026/09/california-home-prices-post-third-weakest-growth-in-us-as-buyers-get-priced-out/ - [2026-09-10] Nationally, existing-home sales fell 2.0% in August 2026 to a 3.98 million SAAR, the weakest month in the report's 13-month series, while inventory reached a 4.9-month supply, the highest in more than a decade — a nationwide demand pullback that typically pressures the West/California disproportionately given its already-negative YoY readings. https://www.northcoastfinancialinc.com/california-real-estate-market-analysis-september-2026/ - [2026-10-01] FRED's realtor.com median-listing-price series for California (not the FHFA index, but a timely cross-check) shows listing prices falling every month from May through September 2026 ($750,000 → $725,000), consistent with softening momentum heading into the Q4 window the contract measures. https://fred.stlouisfed.org/series/MEDLISPRICA BOTTOM LINE: Every freshly available data point since the colleagues' Q2 2026 FHFA print — rising mortgage rates (6.95% by mid-September), a September 2026 Fed hike with more signaled, loosening CA inventory/days-on-market, flat-to-negative per-square-foot pricing, and C.A.R.'s own October 7 downward revision of its full-year 2026 forecast — points toward continued softness or outright decline in California home values through Q4 2026, favoring a NO resolution (index at or below 419.85). NOT FOUND: No direct FHFA index_sa point value for Q3/Q4 2026 California exists yet (next release Nov 24, 2026 for Q3; Feb 23, 2027 for Q4); could not find a CA-specific Q4-2026 mortgage-rate or home-price nowcast beyond the C.A.R. October 2026 annual forecast and September 2026 monthly data already cited.