Tuesday, June 30, 2009
The April report(.pdf) for the S&P Case-Shiller Home Price Indexes showed an easing of home price declines across the country after months of record declines. From March to April, the 20-city index fell just 0.6 percent, its "least bad" reading since last June, and the annual rate of decline improved from -18.7 percent to -18.1 percent.
Note that the top-to-bottom end-positions of the curves on the right of the chart correspond to the order in the legend in the upper left to aid in viewing the data.
Poor Detroit continues to plumb new lows, the index falling from 71.67 in March to just 69.2 in April, well off the bottom of the chart.
As shown below, Phoenix maintained its leadership role in year-over-year price declines with an astonishing 35.3 percent plunge, only slightly improved from last month's 36.0 percent decline. Conditions worsened in Las Vegas, however, April's annual decline of 32.2 percent exceeding the 31.2 percent drop seen in March.
San Francisco moved from the 30+ percent decline group (indicated by red underlines) back to the 20+ percent decline group (indicated by blue underlines), however, there were no similar moves out of the 20+ percent decline group which now numbers seven.
David M. Blitzer, Chairman of the Index Committee at Standard & Poor's notes:
The pace of decline in residential real estate slowed in April. In addition to the 10-City and 20-City Composites, 13 of the 20 metro areas also saw improvement in their annual return compared to that of March. Furthermore, every metro area, except for Charlotte, recorded an improvement in monthly returns over March. While one month’s data cannot determine if a turnaround has begun; it seems that some stabilization may be appearing in some of the regions. We are entering the seasonally strong period in the housing market, so it will take some time to determine if a recovery is really here.Mr. Blitzer doesn't appear to be quite convinced yet - "some stabilization may be appearing in some of the regions" is not exactly a ringing endorsement of a return to normalcy.
The stock market bottomed in March and measures of consumer confidence have turned upward. This report shows that these better spirits are also appearing in the housing market.
It will take at least a few months of actual increases in prices before a bottom can reasonably be called. When exactly that happens is anyones guess - my guess is that it won't be this year.