Home Prices Increases Slow Down in August According to the S&P/Case-Shiller Home Price Indices

/PRNewswire/ -- Data through August 2010, released today by Standard &Poor's for its S&P/Case-Shiller (1) Home Price Indices, the leading measure of U.S. home prices, show a deceleration in the annual growth rates in 17 of the 20 MSAs and the 10- and 20-City Composites in August compared to what was reported for July 2010. The 10-City Composite was up 2.6% and the 20-City Composite was up 1.7% from their levels in August 2009. Home prices decreased in 15 of the 20 MSAs and both Composites in August from their July levels.

The annual returns of the 10-City and 20-City Composite Home Price Indices show increases of 2.6% and 1.7%, respectively, in August 2010 compared to the same month in 2009. In August, 12 of the 20 MSAs posted negative annual growth rates. This is two more than what was reported in July, as Detroit and Miami posted negative annual rates in August. While still negative, three of the 20 MSAs saw improvement in year-over-year growth rates in August as compared to July. They are Charlotte, Cleveland and Las Vegas with annual growth rates of -3.4%, -0.4% and -4.5%, respectively. Annual growth rates slowed down in the three California cities, with Los Angeles, San Diego and San Francisco posting annual gains of +5.4%, +6.9% and +7.8%, respectively – a significant drop from the +7.5%, +9.3% and +11.2% reported for July.

"A disappointing report. Home prices broadly declined in August. Seventeen of the 20 cities and both Composites saw a weakening in year-over-year figures, as compared to July, indicating that the housing market continues to bounce along the recent lows," says David M. Blitzer, Chairman of the Index Committee at Standard &Poor's. "Over the last four months both the 10- and 20-City Composites show slowing growth, after sustaining consistent gains since their April 2009 troughs.

"The month-over-month growth rates tell the same story. Fifteen of the 20 MSAs and the two Composites saw a decline in the month of August as compared to July levels. The 10- and 20-City Composites fell 0.1% and 0.2%, respectively. Indeed, the housing market appears to have stabilized at new lows. At this time, it does not seem that any of the markets are hanging on to the temporary momentum caused by the homebuyers' tax credits."

As of August 2010, average home prices across the United States are back to the levels where they were in late 2003 and early 2004. Measured from June/July 2006 through August 2010, the peak-to-current declines for the 10-City Composite and 20-City Composite are -28.4% and -28.1%, respectively. The improvements from their April 2009 trough are +7.8% and +6.7%, respectively.

With August data, we find that 15 of the 20 MSAs and both Composites saw prices fall from their July values. Chicago, Detroit, Las Vegas, New York and Washington DC were the only five cities that recorded marginal improvements in home prices over July. The 10- and 20-City Composites were down 0.1% and 0.2%, respectively, in August versus July.

Chicago, Detroit, New York and Washington DC have all posted at least four consecutive months of positive increases in home prices; but none of the MSAs had monthly increases of greater than 1% in August. San Diego, which had posted 15 consecutive months of positive monthly change, recorded a 0.6% drop in average home prices in August. The same is true of Atlanta, Boston, Los Angeles, Miami, Minneapolis, San Francisco, Seattle and the two Composites – they all broke their trend of several consecutive months of positive monthly gains with August's report.

The table below summarizes the results for August 2010. The S&P/Case-Shiller Home Price Indices are revised for the 24 prior months, based on the receipt of additional source data. More than 23 years of history for these data series is available, and can be accessed in full by going to www.homeprice.standardandpoors.com.

	August 2010	August/July	July/June
Metropolitan Area	Level	Change (%)	Change (%)	1-Year Change (%)
Atlanta	109.09	-0.8%	0.3%	-2.0%
Boston	158.35	-0.3%	0.6%	1.5%
Charlotte	116.60	-0.4%	-0.2%	-3.4%
Chicago	126.70	0.4%	1.0%	-2.9%
Cleveland	107.00	-0.3%	0.0%	-0.4%
Dallas	119.41	-1.1%	-0.3%	-1.7%
Denver	128.57	-0.1%	-0.4%	-1.2%
Detroit	71.54	0.5%	1.6%	-0.1%
Las Vegas	101.03	0.1%	-0.8%	-4.5%
Los Angeles	175.55	-0.4%	0.3%	5.4%
Miami	147.47	-0.3%	0.7%	-1.0%
Minneapolis	126.53	-0.3%	0.7%	2.9%
New York	175.27	0.2%	1.2%	0.1%
Phoenix	108.84	-1.3%	-0.6%	0.4%
Portland	147.02	-0.9%	-0.3%	-2.3%
San Diego	163.99	-0.6%	0.7%	6.9%
San Francisco	142.83	-0.3%	0.5%	7.8%
Seattle	145.93	-0.8%	0.1%	-2.4%
Tampa	137.53	-0.5%	-0.2%	-4.1%
Washington	188.26	0.3%	1.0%	4.8%
Composite-10	162.13	-0.1%	0.8%	2.6%
Composite-20	148.59	-0.2%	0.6%	1.7%
Source: Standard & Poor's and Fiserv
Data through August 2010

Since its launch in early 2006, the S&P/Case-Shiller Home Price Indices have published, and the markets have followed and reported on, the non-seasonally adjusted data set used in the headline indices. For analytical purposes, Standard &Poor's does publish a seasonally adjusted data set covered in the headline indices, as well as for the 17 of 20 markets with tiered price indices and the five condo markets that are tracked. A summary of the monthly changes using the seasonally adjusted (SA) and non-seasonally adjusted (NSA) data can be found in the table below.

A summary of the monthly changes using the seasonally adjusted (SA) and non-seasonally adjusted (NSA) data can be found in the table below.

	August/July Change (%)		July/June Change (%)
Metropolitan Area	NSA	SA	NSA	SA
Atlanta	-0.8%	-0.7%	0.3%	-1.0%
Boston	-0.3%	-0.1%	0.6%	0.0%
Charlotte	-0.4%	-0.4%	-0.2%	-0.5%
Chicago	0.4%	-0.4%	1.0%	-0.1%
Cleveland	-0.3%	-1.1%	0.0%	-0.6%
Dallas	-1.1%	-1.1%	-0.3%	-0.7%
Denver	-0.1%	-1.1%	-0.4%	-0.9%
Detroit	0.5%	-0.5%	1.6%	-0.1%
Las Vegas	0.1%	-0.5%	-0.8%	-1.5%
Los Angeles	-0.4%	-0.9%	0.3%	-0.4%
Miami	-0.3%	-0.7%	0.7%	-0.2%
Minneapolis	-0.3%	-0.7%	0.7%	-1.8%
New York	0.2%	0.0%	1.2%	0.9%
Phoenix	-1.3%	-2.2%	-0.6%	-1.5%
Portland	-0.9%	-0.8%	-0.3%	-0.9%
San Diego	-0.6%	-0.6%	0.7%	-0.2%
San Francisco	-0.3%	-0.8%	0.5%	-0.7%
Seattle	-0.8%	-1.0%	0.1%	-0.2%
Tampa	-0.5%	-0.4%	-0.2%	-1.4%
Washington	0.3%	0.0%	1.0%	0.5%
Composite-10	-0.1%	-0.2%	0.8%	0.0%
Composite-20	-0.2%	-0.3%	0.6%	-0.2%
Source: Standard & Poor's and Fiserv
Data through August 2010

The S&P/Case-Shiller Home Price Indices are published on the last Tuesday of each month at 9:00 am ET. They are constructed to accurately track the price path of typical single-family homes located in each metropolitan area provided. Each index combines matched price pairs for thousands of individual houses from the available universe of arms-length sales data. The S&P/Case-Shiller National U.S. Home Price Index tracks the value of single-family housing within the United States. The index is a composite of single-family home price indices for the nine U.S. Census divisions and is calculated quarterly. The S&P/Case-Shiller Composite of 10 Home Price Index is a value-weighted average of the 10 original metro area indices. The S&P/Case-Shiller Composite of 20 Home Price Index is a value-weighted average of the 20 metro area indices. The indices have a base value of 100 in January 2000; thus, for example, a current index value of 150 translates to a 50% appreciation rate since January 2000 for a typical home located within the subject market.

These indices are generated and published under agreements between Standard & Poor's and Fiserv, Inc. The S&;P/Case-Shiller Home Price Indices are produced by Fiserv, Inc. In addition to the S&;P/Case-Shiller Home Price Indices, Fiserv also offers home price index sets covering thousands of zip codes, counties, metro areas, and state markets. The indices, published by Standard &Poor's, represent just a small subset of the broader data available through Fiserv.

For more information about S&P Indices, please visit www.standardandpoors.com/indices.

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Housing Prices Continue to Decline Nationwide

(BUSINESS WIRE)--IHS Global Insight, the world's leading company for economic and financial analysis and forecasting, today released the third-quarter 2008 update of the U.S. housing valuation analysis, House Prices in America, showing that single-family U.S. home prices fell at a faster pace across a wide area of the country — after moderating earlier in the year — and are now 6.5% below their 2007 peak. House prices fell at a 6.9% annualized pace, affecting 241 of the 330 analyzed metropolitan areas, up from 150 metro areas in the second-quarter 2008. For the United States as a whole, the housing market is now slightly undervalued. When weighted by market value, the nation is 3.8% undervalued; when weighted by housing units, it is 5.7% undervalued.

While the contraction in residential real estate value is national in scope, it is most severe in the Southeast and Southwest, areas which were among the most overvalued in the country three years ago. According to the third-quarter analysis, extreme overvaluation is now "essentially nonexistent" — only three metro areas met the definition of extreme overvaluation, down from a peak of 52 metro areas in 2005. Only the Pacific Northwest remains overvalued.

According to the analysis, the overhang of unsold properties trending downward during the third quarter, and demand picking up slightly, the accelerated pace of depreciation likely reflects financing conditions that became increasingly stringent and expensive during this period. Recent policy responses, from the Federal Reserve in particular, to purchase mortgage-backed securities are not likely to have a significant impact until next year.

Home prices fell more than 10% in the third quarter in nine central California communities. The Central Valley communities of Merced, Stockton, and Modesto have seen property values fall to less than half their 2005 value. Twenty-nine metro areas in California, Florida, and Nevada — at one time among the most overvalued — have seen price declines in excess of 30%. Similar steep price drops are also occurring in Michigan, northeast Ohio, the southern metro areas from Charlotte to Atlanta, as well as in New England.

The incidence of extreme overvaluation has become negligible; only Atlantic City, New Jersey; Bend, Oregon; and St. George, Utah met the criteria. Overvalued markets are mainly located in the Pacific Northwest, extending to Utah. Southern metro areas from Mississippi to Texas remain generally undervalued.

Jeannine Cataldi, senior economist and manager of IHS Global Insight's Regional Real Estate Service, added, "Weak economic conditions and wary consumers continue to hold the housing market back. Although many areas are seeing home sales increase, it is largely due to foreclosure homes being snapped up at significantly discounted prices. As the inventory of these homes is removed from the market, prices will remain on a downward path."

James Diffley, group managing director of IHS Global Insight's Regional Services Group, said, "With no end in sight to the downward spiral of house prices, it is likely that long anticipated market correction will now overshoot fundamental valuations on the downside.”

The House Prices in America study, a joint effort by IHS Global Insight and National City Corporation, examines the top 330 U.S. real estate markets, representing 78% of all existing housing units and 86% of all related real estate value, to determine what home prices should be, accounting for differences in population density, relative income levels, interest rates, and historically observed market premiums or discounts. Markets with valuation premiums above 35% were deemed at risk for price corrections based on the typical degree of overvaluation that preceded the 79 known local market price declines observed since 1985.

House Prices in America combines a statistical model originally developed by Richard DeKaser, Chief Economist at National City Corporation (www.nationalcity.com/housevaluation) with data largely developed at IHS Global Insight. More information on IHS Global Insight's housing valuation analysis is available at www.globalinsight.com/housingvaluation.

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Real Estate Prices Rise for Four Straight Months - Is Anyone Noticing?

RISMEDIA - Amidst the gloom on Wall Street about housing someone forgot to check the stats. The National Association of Realtors® has now reported four straight months of rising housing prices, but it seems no one is listening.

According to NAR statistics, the median home price has fallen from a high of $230,200 in July 2006 to a low in February 2008 at $195,600, a drop of 15%. Since February, however, it has risen steadily every month. By May the index (which will be revised on July 24) had risen to $208,600, up $13,000 and a full 6.6%. Another indicator, the mean home price (otherwise known as the average home price), has also shown strength and has risen from a low of $242,000 also in February of this year to $253,100, a rise of $11,100 or 4.5%. It, too, has risen every month since February of this year.

“I just don’t know where Wall Street’s brains are today,” said David Michonski, CEO of Coldwell Banker Hunt Kennedy in New York City. “Everyone on the Street is wringing their hands over housing when in fact the average American has been out this spring buying homes and pushing the median price higher. This has got to go down as one of Wall Street and Main Street’s biggest disconnects in history.”

In addition, on an annualized basis the volume of home sales has also risen somewhat from a low of 4,890,000 homes in January to 4,990,000 in May.

“Rising prices on expanding volume should not a crisis make on Wall Street,” says Michonski.

So why the crisis?

“They say that there are bulls and bears on Wall Street but there are also pigs. Pigs try not just to profit from a crisis but create one to profit from. Today there are just so many people who have positioned themselves to profit from a crisis that they refuse to admit the reality of what is happening on Main Street. It might hurt their positions.”

Is this the bottom?

“No one can know for sure, but the hard data is clear. The median price has risen four straight months. The average American is out there taking advantage of bargains in their local real estate market. They are not listening to Wall Street but following their own belief that the best time to buy is when no one else is, and they are out there buying. If this keeps up, February may prove to have been the low in prices.”

“It is possible that it will not be Hank Paulson or Ben Bernanke who will pull this country out of a housing recession, but the good common sense of the average American whose affordability to buy a home is at a five year high and is acting on it.”