Tuesday, February 28, 2012

Case Shiller: House Prices fall to new post-bubble lows in December

by Bill McBride on 2/28/2012 09:00:00 AM

S&P/Case-Shiller released the monthly Home Price Indices for December (a 3 month average of October, November and December).

This release includes prices for 20 individual cities, two composite indices (for 10 cities and 20 cities) and the quarterly national index.

Note: Case-Shiller reports NSA, I use the SA data.

From S&P: All Three Home Price Composites End 2011 at New Lows According to the S&P/Case-Shiller Home Price Indices

Data through December 2011, released today by S&P Indices for its S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices, showed that all three headline composites ended 2011 at new index lows. The national composite fell by 3.8% during the fourth quarter of 2011 and was down 4.0% versus the fourth quarter of 2010. Both the 10- and 20-City Composites fell by 1.1`% in December over November, and posted annual returns of -3.9% and -4.0% versus December 2010, respectively. These are worse than the -3.8% respective annual rates both reported for November. With these latest data, all three composites are at their lowest levels since the housing crisis began in mid-2006.

In addition to both Composites, 18 of the 20 MSAs saw monthly declines in December over November. Miami and Phoenix were up 0.2% and 0.8%, respectively. ...

“In terms of prices, the housing market ended 2011 on a very disappointing note,” says David M. Blitzer, Chairman of the Index Committee at S&P Indices. “With this month’s report we saw all three composite hit new record lows."
Case-Shiller House Prices Indices Click on graph for larger image.

The first graph shows the nominal seasonally adjusted Composite 10 and Composite 20 indices (the Composite 20 was started in January 2000).

The Composite 10 index is off 34.0% from the peak, and down 0.5% in December (SA). The Composite 10 is at a new post bubble low (both Seasonally adjusted and Not Seasonally Adjusted).

The Composite 20 index is off 33.9% from the peak, and down 0.5% in December (SA). The Composite 20 is also at a new post-bubble low.

Case-Shiller House Prices Indices The second graph shows the Year over year change in both indices.

The Composite 10 SA is down 3.9% compared to December 2010.

The Composite 20 SA is down 4.0% compared to December 2010. This was a slightly larger year-over-year decline for both indexes than in November.

The third graph shows the price declines from the peak for each city included in S&P/Case-Shiller indices.

Case-Shiller Price Declines Prices increased (SA) in 8 of the 20 Case-Shiller cities in December seasonally adjusted (only 2 city increased NSA). Prices in Las Vegas are off 61.6% from the peak, and prices in Dallas only off 9.0% from the peak.

Both the SA and NSA are at new post-bubble lows - and the NSA indexes will continue to decline for the next few months (this report was for the three months ending in December). I'll have more on house prices later this morning.

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