Case-Shiller: Simultaneous Summer Surge Stretches On
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. – July data is released in September).
Here are the basic Case-Shiller stats for the Los Angeles area (which Case-Shiller defines as LA and Orange Counties) as of July:
Month to Month: Up 1.8% (raw)
Month to Month: Up 1.2% (seasonally adjusted)
Year to Year: Down 14.9%
Change from Peak: Down 40.2% in 34 months
Seventeen of the twenty metro areas tracked by Case-Shiller saw an increase in their respective seasonally-adjusted HPIs between June and July. Only Las Vegas, Seattle, and Detroit continued to mark seasonally-adjusted drops month-to-month.
Los Angeles already appeared to be finally headed into the price floor before the massive government intervention into the market and the economy in general this spring, so it is not terribly surprising to see that the year-over-year price declines have moderated significantly in the last few months.
Here’s a chart of Case-Shiller HPIs for all the markets that Redfin serves:
Here’s our peak decline 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.
I suppose this summer could be called the summer of the sudden surge or the summer of the massive desperate government intervention. Either way, the result has been increasing prices in most markets over the past few months. Potentially good news if you’re trying to sell your house, but not especially encouraging if you’re hoping to buy, but prices had not yet come down quite into your reasonable range yet. Whether the $8,000 first-time homebuyer tax credit expires or not, I think this winter will be interesting.
Here’s the flip side of the peak decline chart, the Great Summer Bounce of Aught-Nine:
Remember: All real estate is local. Except of course when the federal government throws billions of dollars into the market, I suppose. Then we get a nationwide sample of the best recovery that $700 billion plus $787 billion can buy!
Case-Shiller: Simultaneous Summer Surge Stretches On | Redfin Orange County Sweet Digs said:
[...] Since Case-Shiller lumps LA and Orange Counties together, I won’t repeat everything I wrote on the LA Sweet Digs blog. For more analysis and some graphs of the LA Case-Shiller data, check out my post over there: Case-Shiller: Simultaneous Summer Surge Stretches On [...]
September 29, 2009 11:52 PM
Ben Nicolas said:
Hi,
I’m a Real Estate Broker in Los Angeles too. I subscribe to your blog and really enjoy reading it. Your analysis is intelligent, useful, and succinct. Thank you for sharing it.
October 3, 2009 1:47 AM
Curt S. said:
These are nice numbers….on the surface, but if you look closely there is a season increase every 12 months. Its called the summer high season. Of course the numbers are up but it is only a seasonal increase. Lets look at the reality – The reality is unemployment is the peaking near 10% (based on the simpliest government measure). If you look at the U6 unemployment measure (the one that includes workers who are classified as “discouraged” because they can’t find a job after a year the unemployment rate is near 18% and +20% in california. The reality is that consumer credit still contracting and consumers are in more debt today then in the history of the USA. No new credit cards or home equity loans with 401K’s 30% drained. Who’s has money to spend on driving the recovery. The reality is that the consumer savings rate is on a sharp increase to +10% from 0% meaning more money not being spend on the recovery. The reality is the government needs to spend nearly 2 Trillon dollars just to keep us on life support; what happens when this gets used up? and we are now entering into a Zero to declining wage period of at least 3 to 5 years. With all this said, who really thinks the real estate market is poised for a growth phase or is the reality that we are seeing a seasonal bounce before we enter the next decline phase.
The reality is that if home sellers would come to reality and lower their prices the market might have a chance to recover in a reasonable time frame rather than the slow bleeding that exists today.
October 4, 2009 5:46 PM
Jc said:
I couldn’t agreed more with the Curt’s statement.
Case/Shiller is another agency sponsored by the banks with a strong support from the realestate industry.
And I find this quite contradictory with an article I read yesterday LATimes. That Case.Shiller is predicting an 8% decline from now until next year. So the question is: who is Exageranting here?
Another issue that I notice in redfin are The Listing-Ponzi-Prices of everyday published.
Why redfin is allowing those listings-frauds?
I can see that redfin is falling into the same Category of those commun realestate liers.
Please redfin you can do better than that.
October 21, 2009 7:48 AM
ed hardy said:
The reality is that if home sellers would come to reality and lower their prices the market might have a chance to recover in a reasonable time frame rather than the slow bleeding that exists today.
November 29, 2009 6:15 PM