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Economy in Brief

Case-Shiller Home Price Index Lowest Since 2005
by Tom Moeller January 30, 2008

According to the S&P/Case-Shiller Composite 10 home price index, U.S. home prices fell another 2.2% m/m in November to the lowest level since April 2005. Home prices have fallen in every month since June of 2006 and the total decline over that period amounts to 9.4%. The November decline pulled the y/y comparison to a negative 8.4%.

The index of 10 U.S. cities and their surrounding areas is not adjusted for the quality or the size of the home. The home price index from the Office of Federal Housing Enterprise Oversight (OFHEO) does make these adjustments. This series indicates that through the third quarter home prices still were rising, but at a reduced 1.8% y/y rate.

The composite index of homes in 20 metropolitan areas fell 2.1% (-7.7% y/y) last month.

Home prices in San Diego California continued quite weak and registered a 13.4% y/y decline and they have fallen 16.3% from the late 2005 peak. Prices in Miami Florida also are down sharply, by 15.1% y/y. Home prices in Las Vegas Nevada registered a 13.2% y/y decline and in Los Angeles prices fell 11.9% y/y.

Relatively moderate declines were registered in New York (-4.8% y/y), Chicago (-3.39% y/y) and Denver (-3.1%).

An overview of the S&P/Case-Shiller home price series can be found here.

The S&P/Case-Shiller home price series can be found in Haver's REGIONAL database.

Masters of Illusion from the Federal Reserve Bank of Minneapolis explores why home prices soar in both high and low inflation eras? It is available here.

S&P/Case-Shiller Home Price Index (NSA, Jan 00 = 100) November October Y/Y 2006 2005 2004
Ten City Composite Index 205.09 209.75 -8.4% 224.56 209.16 178.90
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