May Case-Shiller Housing Numbers

Below we highlight a color-scaled look at the May S&P/Case-Shiller housing numbers released today.  For each city we highlight the month-over-month change, the year-over-year change, as well as how long it has been since the current reading was this low.

The West Coast and Miami continue to be problem areas, with month-over-month declines of 1% or more, and year-over-year declines of 20% or more. Las Vegas and Miami are down the most year-over-year at 28%.  While many are happy that 7 areas saw month-over-month gains, it's probably negative that there weren't more, given that the Composite index has seen month-over-month gains from April to May in every year except this year and '07 since '91.

Probably the most disheartening of the data is how much of the gains from '04 to now have been given up.  The Composite 10-City index is now at its lowest levels since June 2004, Vegas hasn't been this low since March 2004, and San Diego hasn't seen these levels since September 2003.  Detroit is the worst, with current prices now back to January 1999 levels.

Comments

[dexterbland:]

If you chart the Case-Shiller numbers (which I have at the link below) you can see that the seasonal factors are fairly insignificant compared to the macro factors in recent times. The charts to me show that most cities are either bottoming out or possibly even starting to rise - especially the ones that didn't have a big run-up over the past few years. Read in combination with the Realtor's report (which shows four consecutive months of increase in the median sale price), I would say there is reason for some optimism here.

i33.tinypic.com/dxnsiw...

2008 Jul 30 05:11 AM

[JSB:]

In 2004 no one was saying that home prices are low. I used to hear scream of high home prices in 2003 too. Have our earnings gone up so much since 2003 that what we used to call very high in 2003 now appears low? On a long term basis home prices should rise for about 5%, which includes components for inflation and development. What we are experiencing is nothing but correction, which has not yet finished. Due to sharp rise and correction, perhaps like a pendulum movement, we might see some over-correction in the near term.

2008 Jul 30 10:51 AM

[Rhett:]

Any perceived improvement in the general housing market at current prices is only a dead cat bounce. Prices have to come down a lot more to be commensurate with salaries, the essential factor in a stable housing market.

2008 Jul 30 11:50 AM

[Tom Lindmark:]

dexterbland makes a good point. There is information in the recent numbers that indicateds the rate of price declines is decelerating. There is also some indication that inventories in some of the harder hit markets might be topping out. Here is a link to what I wrote yesterday.
blog.metro-real-estate...
It contains some links to other blogs and articles on the topic.

2008 Jul 30 12:00 PM