Home Prices Continue to Rise in May 2012 According to the S&P/Case-Shiller Home Price Indices
NEW YORK, July 31, 2012 /PRNewswire/ — Data through May 2012, released today by S&P Dow Jones Indices for its S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices, showed that average home prices increased by 2.2% in May over April for both the 10- and 20-City Composites.
With May’s data, we found that home prices fell annually by 1.0% for the 10-City Composite and by 0.7% for the 20-City Composite versus May 2011. Both Composites and 17 of the 20 MSAs saw increases in annual returns in May compared to April. Boston, Charlotte and Detroit were the three cities that saw their annual returns worsen in May, with annual rates of -0.1%, +0.9% and +0.6%, respectively. Atlanta continues to be the only city posting a double-digit negative annual return with -14.5%. However, this is an improvement over the -17.0% annual decline recorded in April 2012. All 20 cities and both Composites posted positive monthly returns. No cities posted new lows in May 2012.
In May 2012, both Composites were up by 2.2% month-over-month, and posted annual returns of -1.0% and -0.7%, respectively.
“With May’s data, we saw a continuing trend of rising home prices for the spring,” says David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. “On a monthly basis, all 20 cities and both Composites posted positive returns and 17 of those cities saw those rates of change increase compared to what was observed for April. Seventeen of the 20 cities and both Composites also saw improved annual rates of return. We have observed two consecutive months of increasing home prices and overall improvements in monthly and annual returns; however, we need to remember that spring and early summer are seasonally strong buying months so this trend must continue throughout the summer and into the fall.
“The 10- and 20-City Composites were each up 2.2% for the month and recorded respective annual rates of decline of 1.0% and 0.7%, compared to May 2011. While still negative, these annual changes are the best we’ve since in at least 18 months.
“Taking a closer look at the cities, Phoenix again posted the best annual return. Average home prices in that region were up 11.5% versus May 2011. It was one of the hardest hit cities in the collapse, and prices are still more than 50% below their June 2006 peak, but the past five months have been positive for that market. Miami and Tampa are two other Sunbelt cities that were hard-hit in the downturn, but are now showing positive annual rates of change. Boston, Charlotte and Detroit, on the other hand, saw their annual rates of return deteriorate compared to April, even though prices rose over the month of May. Las Vegas posted both a positive monthly change in May and saw an improvement in its annual return; that said, the market is still more than 60% below it August 2006 peak.
“June data for existing home sales, new home sales, housing starts and mortgage default rates were a bit mixed, but all are better than their year-ago levels. The housing market seems to be stabilizing, but we are definitely in a wait-and-see mode for the next few months.”
As of May 2012, average home prices across the United States are back to the levels where they were in spring 2003 for the 20-City Composite and to summer 2003 levels for the 10-City Composite. Measured from their June/July 2006 peaks through May 2012, the decline for both Composites is approximately 33%. The 10-City Composite recently reached its low in the current housing cycle in March 2012 and the 20-City in February 2012; at that time both Composites were down approximately 35% from their summer 2006 peaks.
In May 2012, we observed all 20 MSAs and both Composites posting positive monthly returns. Atlanta, again, was the only city to post a double-digit negative annual rate of return of 14.5%; however it saw improvements in both monthly and annual rates versus what was published for April. Phoenix posted the highest annual rate of growth amongst all 20 cities at +11.5%, an improvement over the +8.6% annual return recorded in April. Chicago fared the best in terms of monthly returns with a 4.5% increase in home prices as compared to April. Atlanta, Cleveland, Detroit and Las Vegas continue to have average home prices below their January 2000 levels.
The table below summarizes the results for May 2012. The S&P/Case-Shiller Home Price Indices are revised for the 24 prior months, based on the receipt of additional source data. More than 25 years of history for these data series is available, and can be accessed in full by going to www.homeprice.standardandpoors.com.
May 2012 May/April April/March Metropolitan Area Level Change (%) Change (%) 1-Year Change (%) ----------------- ----- --------- --------- ---------------- Atlanta 87.85 4.0% 2.3% -14.5% Boston 150.67 2.4% 0.9% -0.1% Charlotte 112.84 1.0% 2.1% 0.9% Chicago 108.62 4.5% 1.2% -3.0% Cleveland 99.17 2.4% 2.3% -0.1% Dallas 118.60 1.9% 1.7% 3.8% Denver 128.48 2.1% 1.7% 3.7% Detroit 66.10 0.4% -3.2% 0.6% Las Vegas 92.55 1.9% 1.1% -3.2% Los Angeles 165.76 2.2% 1.5% -2.0% Miami 143.35 1.4% 0.4% 3.4% Minneapolis 113.47 3.1% 0.6% 4.7% New York 160.40 1.4% 0.2% -2.8% Phoenix 111.92 2.7% 2.5% 11.5% Portland 135.09 2.6% 2.0% 0.4% San Diego 153.06 0.9% 1.4% -1.1% San Francisco 135.28 3.9% 3.4% 0.6% Seattle 137.37 2.6% 2.0% 0.6% Tampa 130.26 2.0% 2.0% 2.5% Washington 185.55 2.5% 2.7% 2.8% Composite-10 151.79 2.2% 1.3% -1.0% Composite-20 138.96 2.2% 1.3% -0.7% ------------ ------ --- --- ---- Source: S&P Dow Jones Indices and Fiserv Data through May 2012
Since its launch in early 2006, the S&P/Case-Shiller Home Price Indices have published, and the markets have followed and reported on, the non-seasonally adjusted data set used in the headline indices. For analytical purposes, S&P Dow Jones Indices publishes a seasonally adjusted data set covered in the headline indices, as well as for the 17 of 20 markets with tiered price indices and the five condo markets that are tracked.
A summary of the monthly changes using the seasonally adjusted (SA) and non-seasonally adjusted (NSA) data can be found in the table below.
May/April April/March Change (%) Change (%) Metropolitan Area NSA SA NSA SA ------------ --- --- --- --- Atlanta 4.0% 2.0% 2.3% 1.0% Boston 2.4% 0.7% 0.9% 0.0% Charlotte 1.0% -0.1% 2.1% 1.3% Chicago 4.5% 2.3% 1.2% 0.1% Cleveland 2.4% 0.7% 2.3% 0.6% Dallas 1.9% 0.5% 1.7% 0.5% Denver 2.1% 0.8% 1.7% 0.5% Detroit 0.4% -0.1% -3.2% -2.0% Las Vegas 1.9% 1.9% 1.1% 1.0% Los Angeles 2.2% 1.1% 1.5% 1.2% Miami 1.4% 0.7% 0.4% 1.1% Minneapolis 3.1% 0.7% 0.6% 1.3% New York 1.4% 0.6% 0.2% 0.3% Phoenix 2.7% 1.8% 2.5% 2.3% Portland 2.6% 0.9% 2.0% 1.2% San Diego 0.9% 0.3% 1.4% 0.6% San Francisco 3.9% 1.7% 3.4% 1.6% Seattle 2.6% 1.2% 2.0% 0.6% Tampa 2.0% 1.0% 2.0% 1.5% Washington 2.5% 1.4% 2.7% 1.4% Composite-10 2.2% 0.9% 1.3% 0.7% Composite-20 2.2% 0.9% 1.3% 0.7% ------------ --- --- --- --- Source: S&P Dow Jones Indices and Fiserv Data through May 2012
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The S&P/Case-Shiller Home Price Indices are published on the last Tuesday of each month at 9:00 am ET. They are constructed to accurately track the price path of typical single-family homes located in each metropolitan area provided. Each index combines matched price pairs for thousands of individual houses from the available universe of arms-length sales data. The S&P/Case-Shiller National U.S. Home Price Index tracks the value of single-family housing within the United States. The index is a composite of single-family home price indices for the nine U.S. Census divisions and is calculated quarterly. The S&P/Case-Shiller Composite of 10 Home Price Index is a value-weighted average of the 10 original metro area indices. The S&P/Case-Shiller Composite of 20 Home Price Index is a value-weighted average of the 20 metro area indices. The indices have a base value of 100 in January 2000; thus, for example, a current index value of 150 translates to a 50% appreciation rate since January 2000 for a typical home located within the subject market.
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