Case-Shiller: Chicago Home Price Declines Rapidly Accelerating
Let’s check in on the S&P/Case-Shiller Home Price Indices (HPI).
For an explanation of how the Case-Shiller data is calculated, check out their methodology pdf. Also remember that the data released on the last Tuesday of a given month is for the period two months prior (i.e. – January data is released in March).
Here are the basic Case-Shiller stats for the Chicago area* as of January:
January 2009
Month to Month: Down 1.5%
Year to Year: Down 7.3%
Change from Peak: Down 17.4% in 28 months
The following chart shows the Chicago area HPI scaled such that the September 2006 peak is 100% on the y-axis. Data on the x-axis is scaled to display the last time (pre-peak) the Chicago area HPI was at or lower than it was in the latest data (May 2003).
While November and December’s data set new records for month-to-month price declines in Chicago at 2.8% and 3.0% respectively, January’s drop blew them both out of the water. Even for those of us that have been expecting continued price declines for some time, the speed at which prices are falling is surprising.
Great news if you felt like you were “priced out” of the market in 2007, 2006, 2005, or even 2004, as the latest price data for Chicago was roughly on par with mid-2003.
Here’s a chart of Case-Shiller HPIs for all the markets that Redfin serves, so you can compare the Chicago area’s performance to other areas across the country:
And here’s our final chart, in which we line up the peak Case-Shiller HPI value for each of Redfin’s markets, so we can see how long each market has been declining, and how much it has dropped from the peak.
Just a few months ago, Chicago’s post-peak performance was tracking fairly closely to the relatively mild price drops seen in Boston. Now it is more on par with San Diego, which has seen a total drop in excess of 40% so far.
*[Case-Shiller defines Chicago as the entire Chicago-Naperville-Joliet, IL Metropolitan Division, which includes all of the following counties: Cook IL, DeKalb IL, Du Page IL, Grundy IL, Kane IL, Kendal IL, McHenry IL, and Will IL.]
