S&P/Case-Shiller Shows Annual Rates Of Decline Improving

Data through January 2010, released Tuesday by Standard & Poor's for its S&P/Case-Shiller Home Price Indices, show that the annual rates of decline of the 10- and 20-city composites improved in January compared to December 2009.

The 10-city composite is unchanged versus where it was a year ago, and the 20-city composite is down only 0.7% versus January 2009. Annual rates for the two composites have not been this close to a positive print since January 2007, S&P says.

All 20 metro areas and both composites showed an improvement in their annual rates with this month's readings compared to the December 2009 print. David M. Blitzer, who chairs S&P's Index Committee, calls the report "mixed."

"While we continue to see improvements in the year-over-year data for all 20 cities, the rebound in housing prices seen last fall is fading," Blitzer explains. "Fewer cities experienced month-to-month gains in January than in December 2009, on both a seasonally adjusted and unadjusted basis. Moreover, in four cities – Charlotte, N.C.; Las Vegas; Seattle; and Tampa, Fla. – prices reached new lows following the financial crisis."

Tampa and Las Vegas experienced some of the largest gains and declines in this cycle, while Charlotte and Seattle saw much more modest price booms and relatively late peaks. On a brighter note, San Francisco and Minneapolis are 15.2% and 12.9% above their trough values.’

As of January, average home prices across the U.S. are at similar levels to where they were in fall 2003. From the peak in June/July 2006 through the trough in April 2009, the 10-city composite is down 33.5%, and the 20-city composite is down 32.6%. The peak-to-date figures through January are -30.2% and -29.6%, respectively.

Los Angeles and San Diego showed slight improvements in actual index levels from the previous month to the current month. All other metros and the two composites showed a slight drop from their December 2009 levels.

On a relative basis, Washington, D.C., Los Angeles and New York have held up the most, with each of those markets still 70% above their January 2000 levels. Las Vegas, which once stood 135% above its January 2000 level, is now showing price increases of about 4% above that same level. Detroit remains the one market whose average value is below 2000 – approximately 28% below that value.

SOURCE: S&P/Case-Schiller Home Price Indices


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