| July Case-Shiller Readings Show Few Signs of Bottoms in Home Prices |
| Written by Jonathan Smoke | |
| 09.30.2008 | |
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Discuss this article on the forums. (0 posts) Standard & Poor’s released the July S&P Case-Shiller home price indices today, and the readings provided little evidence of a bottom being reached in the markets covered. The 10-year and 20-year composite indices reached new record year-over-year declines of 17.5% and 16.3%, respectively. We noted last month that while the year-over-year metrics continue to hit new record lows, the rate of decline was showing improvement month-over-month. That changed in July. In July, the two composite indices were down 1.1% and 0.9% respectively over June, whereas they were only down 0.6% and 0.5% in June over May. Standard & Poor’s noted in their release that while the general pace of decline has slowed there’s little evidence of a bottom being hit: “… the pace of the decline has slowed, particularly over the last three months. For the three months of May thru July, home prices cumulatively fell about 2.2%; whereas for the three months of February thru April, and November 2007 thru January, the cumulative rates of decline were closer to 6.0-6.5%.
‘There are signs of a slow down in the rate of decline across the metro areas, but no evidence of a bottom’ says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. ‘Little positive news can be found when cities like Las Vegas and Phoenix report annual declines as large as -29.9% and -29.3%, respectively, and all 20 cities are still in negative territory on a year-over-year basis. The Sunbelt continues to be the story, with the seven cities that basically represent that area reporting annual declines roughly between 20 and 30%. While some cities did show some marginal improvement over last month’s data, there is still very little evidence of any particular region experiencing an absolute turnaround.’ While there are differences across regions, at the national level the housing market peaked around June/July of 2006. As of July 2008, two years later, the 10-City Composite has fallen by a total of 21.1% and the 20-City Composite is down 19.5%.” Six of the twenty cities covered by S&P showed improvement in July over June: Atlanta, Boston, Dallas, Denver, Detroit and Minneapolis. Atlanta, Boston, Dallas, Denver and Minneapolis all continue a streak of higher readings for three months or more. Detroit registered an improvement for the first time in 31 months. On the flip side, Charlotte, Chicago, Cleveland and New York saw declines after improving in June, but the declines experienced were very minor. Tampa was effectively unchanged in July over June. 
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