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Economy in Brief

Case-Shiller Home Price Index Hits A Brick Wall?
by Tom Moeller March 30, 2010

News-wire headlines indicate that the rebound in home prices has stalled. Seasonally adjusted, the Case Shiller Home Price Index fell during January by 0.4% for the fourth consecutive month. This, however, overstates the weakness since seasonally adjusted prices have been rising slightly since last June. Regardless, the y/y trend paints a different picture of improvement. The 0.7% decline versus last January compares to a 19.0% y/y rate of decline at its worst one year ago. That's not a barn-burning improvement, however, and it may not go much further unless home sales improve.

The narrower 10 City Composite Index rose a seasonally adjusted 0.4% (-0.0% y/y) for the second month. The 12-month decline also eased from -19.4% at its worst. By far, these negative comparisons outpace those during the 1990-91 recession when home prices fell 6.3%.

The performance of home prices continues to vary around the country. During January, yearly price gains improved in twelve cities including Boston, San Diego, Los Angeles, San Francisco, Denver, Dallas and Washington D.C. They continued down in seven cities including Atlanta, Chicago, Miami, Detroit and Seattle.

The Case Shiller home price series are value-weighted, i.e., a greater index weight is assigned to more expensive homes. The S&P/Case-Shiller home price series can be found in Haver's USECON database and the city data highlighted below is in the REGIONAL database.

Responding to the foreclosure crisis—A conference summary from the Federal Reserve Bank of Chicago is available here.

S&P/Case-Shiller Home Price Index (SA, Jan 00 = 100) January m/m December m/m November m/m Jan. y/y 2009 2008 2007
20 City Composite Index 0.3 0.3% 0.3% -0.7% -13.3% -15.7% -3.8%
  Regional Indicators
     Atlanta -0.5 0.0 0.1 -2.1 -11.6 -8.5 0.7
     Boston 0.3 0.7 0.6 1.5 -4.9 -5.7 -4.0
     Chicago -0.8 -0.7 -0.7 -4.3 -14.2 -10.0 -1.0
     Dallas -0.3 0.2 0.9 4.2 -2.3 -3.2 0.5
     Denver 0.1 -0.0 0.3 2.8 -2.8 -4.9 -1.7
     Los Angeles 1.8 1.2 1.4 3.8 -15.4 -24.2 -5.2
     New York -0.3 -0.4 -0.9 -5.4 -9.8 -7.4 -2.8
     San Francisco 0.6 0.8 1.2 9.1 -18.4 -24.3 -4.5
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