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S&P/Case-Shiller index shows U.S. values falling below 2009 trough
http://www.marketwatch.com/story/sp-data-signals-double-dip-in-housing-2011-05-31?dist=countdown
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — U.S. home prices fell in March for the eighth straight month, confirming the beleaguered housing market has entered a double-dip recession, according to a closely followed index released Tuesday
Home prices in 20 major U.S. cities declined 0.8% in March on a non-seasonally adjusted basis, according to the Case-Shiller home-price index released by Standard & Poor’s.
Prices fell in 18 of 20 cities in March on a monthly basis. Only Washington, D.C., and Seattle showed advances. Over the past year, only Washington, D.C., has seen prices advance.
Prices fell 3.6% on a year-over-year basis in March, compared with a 3.3% year-over-year drop in February.
The 20-city index is now below its April 2009 trough, meaning that home prices have fully retreated from gains posted from May 2009 through June 2010, putting housing in a double-dip downturn.
“Home prices continue on their downward spiral with no relief in sight,†said David Blitzer, chairman of the index committee at Standard & Poor’s. Read the full S&P release.
Housing has been plagued by issues that have created a Gordian knot for the sector.
On the supply side, an oversupply of distressed properties is pushing prices down. There are also worries of a so-called shadow inventory of homes that sellers and banks want to list but have not, waiting for a more favorable environment.
On the demand side, many consumers are still having difficulty qualifying for mortgages, even though rates are low.
Economists have said that a healthy labor market could help cure these ills, but the labor market has been struggling, as well.
Some economists believe that sales may pick up if buyers become convinced that mortgage rates are likely to rise, given talk of a Federal Reserve exit from its easy monetary policy.
Lou Crandall, chief economist at Wrightson ICAP, said he thinks home prices will be down 4% on a year-over-year basis this summer before starting to turn higher.
The S&P/Case-Shiller index is based on a three-month moving average of home prices. So the March data reflect price data for January, February and March. This makes the index less volatile than other house-price gauges, notably from CoreLogic and the Federal Housing Finance Agency.
In ascending order, here’s how each of the 20 cities fared over the past year: Minneapolis, down 10%; Phoenix, down 8.4%; Chicago, down 7.6%; Portland, Ore., down 7.6%; Seattle, down 7.5%; Tampa, Fla., down 6.9%; Charlotte, N.C., down 6.8%; Cleveland, down 6.3%; Miami, Fla., down 6.1%; Las Vegas, down 5.3%; Atlanta, down 5.2%; San Francisco, down 5.1%; San Diego, down 4.0%; Denver, down 3.8%; New York, down 3.4%; Boston, down 2.7%; Dallas, down 2.5%; %; Los Angeles, down 1.7%; Detroit, down 0.9%; and Washington D.C., up 4.3%.
http://www.marketwatch.com/story/sp-data-signals-double-dip-in-housing-2011-05-31?dist=countdown
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — U.S. home prices fell in March for the eighth straight month, confirming the beleaguered housing market has entered a double-dip recession, according to a closely followed index released Tuesday
Home prices in 20 major U.S. cities declined 0.8% in March on a non-seasonally adjusted basis, according to the Case-Shiller home-price index released by Standard & Poor’s.
Prices fell in 18 of 20 cities in March on a monthly basis. Only Washington, D.C., and Seattle showed advances. Over the past year, only Washington, D.C., has seen prices advance.
Prices fell 3.6% on a year-over-year basis in March, compared with a 3.3% year-over-year drop in February.
The 20-city index is now below its April 2009 trough, meaning that home prices have fully retreated from gains posted from May 2009 through June 2010, putting housing in a double-dip downturn.
“Home prices continue on their downward spiral with no relief in sight,†said David Blitzer, chairman of the index committee at Standard & Poor’s. Read the full S&P release.
Housing has been plagued by issues that have created a Gordian knot for the sector.
On the supply side, an oversupply of distressed properties is pushing prices down. There are also worries of a so-called shadow inventory of homes that sellers and banks want to list but have not, waiting for a more favorable environment.
On the demand side, many consumers are still having difficulty qualifying for mortgages, even though rates are low.
Economists have said that a healthy labor market could help cure these ills, but the labor market has been struggling, as well.
Some economists believe that sales may pick up if buyers become convinced that mortgage rates are likely to rise, given talk of a Federal Reserve exit from its easy monetary policy.
Lou Crandall, chief economist at Wrightson ICAP, said he thinks home prices will be down 4% on a year-over-year basis this summer before starting to turn higher.
The S&P/Case-Shiller index is based on a three-month moving average of home prices. So the March data reflect price data for January, February and March. This makes the index less volatile than other house-price gauges, notably from CoreLogic and the Federal Housing Finance Agency.
In ascending order, here’s how each of the 20 cities fared over the past year: Minneapolis, down 10%; Phoenix, down 8.4%; Chicago, down 7.6%; Portland, Ore., down 7.6%; Seattle, down 7.5%; Tampa, Fla., down 6.9%; Charlotte, N.C., down 6.8%; Cleveland, down 6.3%; Miami, Fla., down 6.1%; Las Vegas, down 5.3%; Atlanta, down 5.2%; San Francisco, down 5.1%; San Diego, down 4.0%; Denver, down 3.8%; New York, down 3.4%; Boston, down 2.7%; Dallas, down 2.5%; %; Los Angeles, down 1.7%; Detroit, down 0.9%; and Washington D.C., up 4.3%.
