S&P Set To Launch New Indexes of Condo Prices

Standard & Poor's, publisher of the closely watched S&P/Case-Shiller Home Price Indices, is set to launch on Nov. 25 new indexes that track condominium prices in five major metropolitan markets—Boston, Chicago, Los Angeles, New York and San Francisco.

That is not the only move building on the popularity of the Case-Shiller indexes. For every season ... there will be more real estate indexes from S&P. The company plans to create seasonally adjusted versions of the existing Case-Shiller indexes, that cover the residential real estate markets in the U.S—the 10-City, 20-City and National Composite indexes. S&P will also create seasonally adjusted versions of the three new condo indexes.

The existing Case-Shiller indexes are about to get even more exposure as they enter the exchange-traded funds world through MacroShares portfolios. These funds are not only unique for targeting the niche residential real estate indexes, but will launch using an initial public offering process never before used by the ETF industry (see story here).

David Blitzer, managing director & chairman of the Index Committee at Standard and Poor's, said in a statement that condo prices behave very differently from residential home prices, and that the condo indexes will provide property owners and investors a more complete picture of the U.S. housing market, as well as more specific takes on relative real estate performance.

The condominium indexes covering the five major metropolitan areas will include historical data beginning in January 1995. The seasonally adjusted data will have the same history as its underlying index, which for the existing Case-Shiller indexes, goes back as far as January 1987.

The new indexes will be part of the supplemental home price data series that are normally available by 9:30 a.m. on the last Tuesday of every month.

Comments

[25 year App...:]

Varying Homeowner's dues per and Owner Occupancy percentages per project make this new index essentially worthless.

Indices do not take into account Mortgage Financing variances also.

CLOSED SALE PRICE MOVEMENTS DO NOT PROVIDE A RELIABLE INDICATION OF MARKET TRENDS.

Follow list price MOVEMENT instead

2008 Nov 21 06:27 PM

[Muzie:]

Oh that's awesome! Now we we have another statistic for the whole nation to obsess over so the markets can have another reason to crash everyday! Thumbs up!

2008 Nov 21 08:28 PM

[Liberty:]

25 Year Appraiser,
I feel differently - Home & condo prices have been tracked for long time periods by National Association of Realtor. I believe giving Wall Streeter's a more transparent view of the condo prices through more/better indexes will improve market info. Although, I have problems with the Case Shiller numbers as well. I prefer the NAR figures on home prices to S&P/Case Shiller as the numbers can be better verified in my book.

2008 Nov 22 03:37 PM

[Tony Rand:]

There is nothing wrong with more data - provided it is relevant and thorough. The new indices are incomplete without additional relevant markets - the five metros chosen will not provide thorough data.

2008 Nov 23 12:00 PM