Case-Shiller Data for April 2009 Hits the Streets: Price Drops Not as Steep

The Case-Shiller numbers on April 2009 home prices came out this morning. Case-Shiller is a measure of how prices have changed for houses that have sold before without having been remodeled since; the goal is to measure only how demand changes, not how houses themselves have gotten bigger or better. Because it was originally developed by economists and is still calculated by a financial analysis business, Standard & Poor’s, Case-Shiller data are considered more reliable than data from real estate agents or home-builders.

Case-Shiller 20-City Composite Index, Seasonally Adjusted

Case-Shiller 20-City Composite Index, Seasonally Adjusted

The Case-Shiller report has some limits. It measures prices for an entire metropolitan area, like the entire Bay Area, not an individual city like San Francisco or Oakland. And we only have prices for April 2009 since it takes S&P a few months to gather and analyze the data. The absolute numbers themselves are arbitrary; like a stock market index, what matters is how the numbers go up or down. S&P set the base-line for each market at 100 in January 2000, and they’ve increased or decreased from there.

That said, the news was good! Even when seasonally adjusted — economists subtract from summer prices and add to winter prices to account for seasonal ups and downs in demand prices – prices were flat or increased in Chicago and Washington DC areas. And only New York and LA areas saw significant month-over-month price declines. In all markets, declines were much smaller than last month. Last month, almost all markets saw month-over-month declines greater than 2%.

The table below shows when each market peaked, and then presents the “equivalent month,” which says when prices were last at their current levels. So for example in the Bay Area, April 2009 prices dropped to where they were in July 2000, and in Seattle, April prices dropped to May 2005 levels. We also show how far the market has fallen from the peak; in California prices are down 41% – 46% from the peak, and then show year-over-year and month-over-month declines.

Metro Area

Date of Max

Equivalent Month

Change from Max

YoY Change

MoM Change

Last Months MoM Change








San Diego







Bay Area










































20-City Index







All the data in the table has been seasonally adjusted. Just looking at the straight numbers without the seasonal adjustment, San Francisco, Boston and Seattle also saw month-over-month improvements. As the Case-Shiller report (PDF) notes, “every metro area, except for Charlotte, recorded an improvement in monthly returns over March.”

In covering the data, The New York Times quotes Ian Sheperdson, chief U.S. economist as saying “This is a real relief. With sales volumes now stable and likely to rise a bit over the next few months, we think sustained slower price falls are a decent bet.” But the Wall Street Journal believes that Case-Shiller will dip again later in the season because the index weights price drops in high-end houses more heavily; demand for high-end homes is lower because first-time home-buyer tax credits are less likely to apply and jumbo loans are harder to get. But SocketSite notes that the gains in home prices occurred at the high-end, not the low-end.

Given how busy Redfin and other brokers have been since April, our own take is that Case Shiller numbers won’t decline much for May or June, but it’s still a mystery what will happen later in the year when more bank-owned listings hit the market — there was a moratorium on foreclosures through March that is still working its way through the sytem — and when the home-buyer tax-credit is scheduled to run out.

What’s your take on where prices are headed next?