Case-Shiller Home Price Index Posts Record Annual Decline

The Sept S&P/Case-Shiller Home Price Index fell 4.9% y/o/y, the biggest drop since the data began in 1988 — but in-line with expectations. It’s the 9th straight month of declines. Lower house prices will help to clear out excess inventories (a lot much more than rate cuts).

Here’s the money quote from Shiller:

“The declines in the national figure are notable for two reasons. First, the 3rd quarter decline, at 1.7%, was the largest quarterly decline in the index’s 21-year history. And, second, the year-over-year decline posted its second consecutive record low at -4.5%. Consistent with prior 2007 reports, there is no real positive news in today’s data. Most of the metro areas continue to show declining or decelerating returns on both an annual and monthly basis.

All 20 metro areas were in decline in September over August. Even the five metro areas that still have positive annual growth rates — Atlanta, Charlotte, Dallas, Portland and Seattle — show continued deceleration in returns.”

Here’s the metro overview:

S&P/Case-Shiller Index Release – September 2007 Index

Table courtesy of Tradition Financial Services, Inc. / TFS Derivatives

S&P/Case-Shiller Home U.S. National Home Price Index Posts a Record Annual
Decline in the 3rd Quarter of 2007

S&P, Nov 27, 2007 09:00 AM EST PDF

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What's been said:

Discussions found on the web:
  1. michael schumacher commented on Nov 27

    totally lost in all the euphoria over bailing out more banks…..

    Guess it will not matter until it drops off the current axis.

    Here’s something I heard yesterday at the bank:

    “You mean we have a housing problem??-

  2. edhopper commented on Nov 27

    Hey Greenspan, it looks like a little of the froth has been blown off the housing market. jeez!

  3. jg commented on Nov 27

    Barry, I’d use bars, not lines, for the graph; YOY changes warrant bars, as they are discrete measures. If you were plotting the index of home values, a continuous measure, I’d use a line, then. JMO.

  4. ScrewBush commented on Nov 27

    I assume the optimistic headline covering this will be:

    Home Prices Match Expectations!

  5. P. Jackson commented on Nov 27

    Barry – TFS got the DC numbers wrong…they’ve issued a correction that is probably in your email box. Just a small FYI – (I believe it was -1.7 percent?)

  6. Sippn commented on Nov 27

    20 years of data does not history make. I always ask my teenager for the “historical” perspective.

  7. Snarky commented on Nov 27

    I guess this can’t be good news, huh?

  8. Resonance commented on Nov 28

    The Winnebago Bellwether

    I’ve read (here and elsewhere) that economists have collectively failed to accurately predict a recession in the past 40 years. So where should we turn to peer into an economic crystal ball? Perhaps the nimble Winnebago. Yes, seriously:Winnebago Indust…

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