Case-Shiller: One Year of Price Gains Wiped Out in a Month
Time for a monthly check-in of 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. – October data is released in December).
Here are the basic Case-Shiller stats for the San Francisco area* as of October:
October 2008
Month to Month: Down 4.2%
Year to Year: Down 31.0%
Change from Peak: Down 36.1%
The following chart shows the San Francisco HPI scaled such that the May 2006 peak is 100% on the y-axis. Data on the x-axis is scaled to display the last time (pre-peak) the San Francisco HPI was at or lower than it was in the latest data (June 2002).
October’s large price drop in San Francisco effectively erased almost an entire year of price gains. In September, San Francisco’s Case-Shiller HPI was at the same level as May 2003. In October, it was at June 2002. Ouch.
Here’s a chart of Case-Shiller HPIs for all the markets that Redfin serves, so you can compare San Francisco’s performance to other areas across the country:
And here’s one more chart, in which I have lined 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.
With October’s steep drop, San Francisco’s total decline of 36.1 is now just barely behind San Diego’s drop of 36.4%, having reached that level six months sooner.
Looking at this latest data, there still does not appear to be any bottom in sight for San Francisco home prices. In fact, price declines are gaining steam. If you are a seller that took your home off the market for the winter hoping for a rebound in spring, the current trends point toward continued disappointment. Of course, for buyers continued price drops means continually better deals to be found.
*[Case-Shiller defines San Francisco as the San Francisco-Oakland-Fremont, CA Metropolitan Statistical Area, which includes all of the following counties: Alameda, Contra Costa, Marin, San Francisco, and San Mateo.]
