Case Shiller Housing Composite Negative for 2007


That’s gonna leave a mark: Data through December 2007 for the Case-Shiller Home Price Index shows broad based declines in the prices of existing
single family homes across the United States. This marks 2007 as a full
year of declining home prices.

As the chart above shows, annual returns of the national home price indices declined -8.9% versus the 4th quarter of 2006. This is the largest decline in
the series’ 20-year history. Comparatively, during the 1990-91 housing recession, the
annual rate bottomed at -2.8%.


“We reached a somber year-end for the housing market in 2007,” says Robert J. Shiller, Professor at Yale University and Chief Economist at MacroMarkets LLC. “Home prices across the nation and in most metro areas are significantly lower than where they were a year ago. Wherever you look things look bleak, with 17 of the 20 metro areas reporting annual declines and the remaining three reporting flat or moderate growth rates. Looking closely at these negative returns, you will see that 14 of the metro areas are also reporting record lows and eight are in double digit decline. The monthly data paint a similar picture, with all metro areas now reporting at least four consecutive negative monthly returns.”

Damn that Shiller! He’s way too negative. All these professorial types, with their confounded data and confusing logic — they are so pessimistic! When are these academics gonna start being more balanced?


Existing Home Sales "Slipped" 23.4%
Monday, February 25, 2008 | 10:41 AM

Year End Numbers Mark Widespread Declines
S&P/Case-Shiller Home Price Indices, February 26, 2008

Home Depot Profit Drops on U.S. Housing Slowdown 
Mark Clothier
Bloomberg, Feb. 26 2008

Table Version:


courtesy of TFS Derivatives

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What's been said:

Discussions found on the web:
  1. HCF commented on Feb 26

    Look on the bright side… Imagine how bad it would be if we actually had inflation, lol…

  2. Uncle Jeffy commented on Feb 26

    The depressing thing is that you even consider it necessary to explain that it’s sarcasm.

    Larry’s probably dialing your number right now.

  3. scorpio commented on Feb 26

    looks like it’s trying to make a bottom….

  4. Dave L commented on Feb 26

    We’ve got a real divergence here between equity markets and facts. The real question is whether that gap is closed up, with better facts, or if the gloomy guses drive stocks down to the level of “reality”.

  5. michael schumacher commented on Feb 26

    it’s another bottom…..the second one of the week….


    it’s just that easy…


  6. Marcus Aurelius commented on Feb 26

    “When are these academics gonna start being more balanced?”

    We need a faith-based economy.

  7. bluestatedon commented on Feb 26

    I think it’s clear that Schiller is an agent of the Islamofascists and the librul Democrats, with the expressed goal of bringing down our incredibly wonderful economy by being so damn pessimistic. Karl Rove himself said that the media is responsible for all this ridiculous talk about recession. I say Gitmoize Schiller until his morale improves. Then have Lawrence Yun conduct a re-education program.

  8. cinefoz commented on Feb 26

    So, by divine extrapolation, the entire economy is going to drop below the nether regions of hades just because housing prices that were pumped up by a credit bubble readjust back to normal? I don’t get your logic.

  9. JustinTheSkeptic commented on Feb 26

    I keep hearing about deflation, because of the house price declines. My question is: what percent of the total money transactions being made in housing are to the total transactions being mad in the whole economy. Any of you Econometric Econ Majors out there that can give me the answer?

  10. commented on Feb 26

    Barry, you remind me of Oddball from the movie Kelly’s Heroes…

    “Why don’t you knock it off with them negative waves? Why don’t you dig how beautiful it is out here? Why don’t you say something righteous and hopeful for a change?”

  11. Stuart commented on Feb 26

    Ya know, looking at that graph, I can’t help but reflect upon the recent commentary on Ken Fisher and his comments.. Smile. Ya, I know, no points, was a bit too easy.

  12. scorpio commented on Feb 26

    entire economy has been propelled by the same kind of credit bubble we see in housing. if the Fed will get out of the way we’ll get a 20-30% correction in the stocks representing the rest of the economy, just as we’ll see a comparable price reduction in housing. based on recent activity doesnt look like we’ll get that correction until sometime after Nov 4. i call that divine.

  13. michael schumacher commented on Feb 26

    I bet you don’t…….facts and reality usually make sure that perception and hope take a back seat.

    and yes the irony of Fischer’s folly is not lost….


  14. mikkel commented on Feb 26

    cinefoz, it’s not about housing, it’s about what was built on top of housing.

    HELOCs (which made up a huge amount of discretionary spending)
    Trillions of dollars of weird financial thingies (like here and here) that even if they aren’t directly related to housing, the losses in things that were is causing huge disruptions.
    Local and state government revenues

    And that was just one blog from the past week.

  15. pete_bk commented on Feb 26

    “We need a faith-based economy.”

    We already have one, and it will be the nonbelievers like us who bring about armagedon

  16. Mr. Obvious commented on Feb 26

    Maybe cinefoz is Sam Zell?

    The US economy will avoid recession as the housing market begins to recover this spring, according to billionaire investor Sam Zell.

    Speaking on “Squawk Box” this morning, Zell attributed much of the current economic troubles to fear-mongering and politicking by Democratic presidential contenders Hillary Rodham Clinton and Barack Obama.

    “Obviously what we have going on is an attempt to create a self-fulfilling prophecy,” said Zell, chairman of Equity Investments Group and owner of the Chicago Cubs, Chicago Tribune, Los Angeles Times and other companies. “We have two Democratic candidates who are vying with each other to describe the economic situation worse.

    “The reality is that if you live on Wall Street and you’re in the credit markets the world couldn’t be worse. If you’re a farmer and you’re getting $25 for your wheat, you’re having a great time. If you’re a CEO and you’ve got a balance sheet that’s bullet-proof, you’re in a great position. This whole thing is way out of control, way out of hand.”

  17. Marcus Aurelius commented on Feb 26

    I don’t get your logic.

    Posted by: cinefoz | Feb 26, 2008 10:50:37 AM


    Apparently, you don’t.

  18. Pool Shark commented on Feb 26

    Real Bottom = 2013

    Just Look at Shiller’s inflation-adjusted home prices from 1890 to the present.

    A picture’s worth a thousand words.

  19. Pool Shark commented on Feb 26

    Oh, by the way:

    Bankrate now shows the national average rate for a 30-year fixed FHA mortgage to be 6.08%.

    Good luck with that refinancing…

  20. JustinTheSkeptic commented on Feb 26

    Zell, must of been told to “help prop-up market psychology,” because I read an article on him about 8 months back where he was saying how rediculous the housing market got, suggesting that the U.S. could only support~60%,70% home ownership, and it got way above that… So I wouldn’t believe anybody that CNBC brings on their programs these days – they all have an agenda – “prop-up stock prices so I can get my shares out without anybody else noticing!” Or perhaps it is: “I’ll do all I can to save this economy that I fucked up so bad by being so greedy.”

  21. mh497 commented on Feb 26

    I’m glad you pointed out that the comment on Shiller was sarcasm, as he is the most even handed person I’ve seen calling the markets. He may look like he tilts negative, (based on two major bubble calls), but he actually is just calling them as he sees them.

    What’s scary is that lately he has been starting to talk about Japan style deflation. However, he says he thinks it’s not the most likely scenerio.

  22. kk commented on Feb 26

    Wow, housing is in the toilet, who would have known? Thanks Barry!

  23. Pat G. commented on Feb 26

    If the FED’s reasons for cutting rates are to make credit more available then why are mortgage, car & credit card interest rates rising? Because lenders don’t care. They are way too busy shoring up their own balance sheets. Wake up Bernanke, it isn’t working!! On second thought go back to sleep and keep cutting, I’ll buy more silver.

  24. eh commented on Feb 26

    Apparently Zell, who just could be an idiot judging by his recent newspaper buys, has more power to move the market via a barely informed opinion than Shiller et al do with all their “data” and “logic”. That’s what makes this market scary.

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