S&P Case-Shiller Index of Home Values Drops, Home Sales Rise

5 Mar

According to numbers released last week for 2011 year-end home prices, U.S. home prices fell in December from a month earlier, ending 2011 at the lowest levels since the housing crisis began in mid-2006.

The report is the most widely-cited, private-sector metric for the housing market. The index aims to measures change in home prices from month-to-month, and from year-to-year, in select U.S. cities and nationwide.

During the fourth quarter, home prices reached new lows, falling 3.8% sequentially and 4% year-to-year. Prices are down 33.8% from their peak in the second quarter of 2006.

“While we thought we saw some signs of stabilization in the middle of 2011, it appears that neither the economy nor consumer confidence was strong enough to move the market in a positive direction as the year ended,” said David Blitzer, chairman of S&P’s index committee. “After a prior three years of accelerated decline, the past two years has been a story of a housing market that is bottoming out but has not yet stabilized.”

The housing market remains sluggish despite soft prices and interest rates that have been hovering around historic lows. A weak job market, abundant foreclosures and tighter mortgage requirements have continued to weigh on the market.

Of the 20 major U.S. metropolitan markets, 18 reported prices were lower than during November. Only Miami and Phoenix moved higher, up a scant 0.2% and 0.8%, respectively. Year-to-year, only Detroit saw improvement, up 0.5%.

The Case-Shiller index of 10 major metropolitan areas and the 20-city index were down 1.1% in December from a month earlier.

Year-to-year, unadjusted December prices declined 3.9% for the 10 major markets while the 20-city index dropped 4%.

On a brighter note, The National Association of Realtors last week reported that sales of previously owned homes in the U.S. rose in January to the highest level in nearly two years and the inventory of unsold homes contracted to a level considered healthy by economists. Existing-home sales increased 4.3% in January from December.

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One Response to “S&P Case-Shiller Index of Home Values Drops, Home Sales Rise”

  1. mcallen foreclosures March 8, 2012 at 11:24 am #

    awesome post! Keep up the good work!

    Like

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