Case-Shiller: Seasonal Home Price Bump Turns Flat in May

It’s time for our monthly check-in of the S&P/Case-Shiller Home Price Indices (HPI). For the full source data behind this post, plus seasonally adjusted and tiered price data, hit the S&P/Case-Shiller website. 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. – May data is released in July).

Before we dig into the data, I’d like to make a brief mention of an excellent post over at the economics website Calculated Risk: A Few Comments on Housing Reports. Quoting from his post:

…the Case-Shiller report today really bothered me. To be more accurate, the reporting on the Case-Shiller report bothers me. As I mentioned earlier today, there is a strong seasonal component to house prices, and although the seasonally adjusted Case-Shiller index was down (Case-Shiller was reported as up by the media) – I don’t think the seasonal factor accurately captures the recent swings in the NSA data.

Keep in mind that the Case-Shiller data that most of the media (including this blog) are reporting on is usually the raw index data. As CR mentioned, the housing market is a very seasonal beast, so it’s difficult to draw any meaningful conclusions from month-to-month changes, unless they are far outside the norm for that time of year. This is why we consistently report the year-to-year change in our summary.

Now that we’ve got that out of the way, here are the basic Case-Shiller stats for the Seattle area* as of May:

May 2009
Month to Month: Down 0.3% (raw)
Month to Month Down 0.8% (seasonally adjusted)
Year to Year: Down 16.6%
Change from Peak: Down 22.5% in 22 months

The following chart shows the Seattle HPI scaled such that the July 2007 peak is 100% on the y-axis. Data on the x-axis is scaled to display the last time (pre-peak) the Seattle HPI was at or lower than it was in the latest data (May 2005).

(All of the charts below are based on the non-seasonally-adjusted Case-Shiller HPI data.)

Fourteen of the twenty metro areas tracked by Case-Shiller saw an increase in their respective raw HPIs in May. Joining Seattle in continuing declines were Tampa, Los Angeles, Miami, Phoenix, and Las Vegas.

Here’s a chart of Case-Shiller HPIs for all the markets that Redfin serves, so you can compare Seattle’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.


It’s also worth keeping in mind that in addition to being from a usually-strong time of year, these numbers represent home sales that closed during the frenzy of interest rates in the fours and the debut of the $8,000 first-time homebuyer tax credit. In my opinion, we won’t really know if home price declines are mostly over until we see the data from October / November. And that advice is worth exactly what you paid for it ;^)

*[Case-Shiller defines Seattle as the Seattle-Tacoma-Bellevue, WA Metropolitan Statistical Area, which includes all of King, Pierce, and Snohomish counties.]

  • Justin Louie

    Thanks Tim. These numbers are really good. It’s true that we have a very very tiny upswing at into August from July as you can see on the tail end. It’s good to see the perspective of what the entire aftermath of our bad judgments have caused thus far.

    None, the less, I hope we’ve somewhat stabilized. I doubt this because general public trust is down and unemployment is still very high. Sigh… here’s to hope.