Case-Shiller: DC Home Price Drops Continue Unabated

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 DC area* as of October:

October 2008
Month to Month: Down 2.6%
Year to Year: Down 18.7%
Change from Peak: Down 26.3%

The following chart shows the DC 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 DC HPI was at or lower than it was in the latest data (May 2004).

Home prices in DC marked another steep decline in the month of October, bringing prices back to levels last seen nearly two and a half years ago. As fast as prices are falling right now, it doesn’t look like they’ll be bottoming out here any time soon.

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

Price declines in DC have been fairly dramatic, surpassed only by the southern California cities (out of the Redfin markets). They also continue to track fairly close to the 20-city composite, and for the second month in a row they fell close to San Diego’s level of six months ago.

The bottom is clearly not here yet for home prices in DC. 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 disappointment. Of course, for buyers continued price drops means continually better deals to be found.

*[Case-Shiller defines Washington DC as the entire Washington-Arlington-Alexandria, DC-VA-MD-WV Metropolitan Statistical Area, which includes all of the District of Columbia and all or part of the following counties: Calvert MD, Charles MD, Frederick MD, Montgomery MD, Prince Georges MD, Alexandria City VA, Arlington VA, Clarke VA, Fairfax VA, Fairfax City VA, Falls Church City VA, Fauquier VA, Fredericksburg City VA, Loudoun VA, Manassas City VA, Manassas Park City VA, Prince William VA, Spotsylvania VA, Stafford VA, Warren VA, and Jefferson WV.]