Case-Shiller Home Prices: April Breaks Eight-Month Downward Trend
This morning S&P/Case-Shiller released their monthly Home Price Index, a leading measure of changes in the price of homes on the residential real-estate market (NYSE:IYR). The new data covers April 2011, and shows minor growth month-over-month, though prices remain extremely low and the housing market remains the biggest drag on the economy.
According to the S&P, housing prices fell by 3.96% in April compared to the previous year. However, breaking an eight-month downward trend, home prices did increase month-over-month by 0.7%. While April’s sales were slightly up over March, it isn’t yet clear whether that improvement reflects a growing market, or whether it was simply up because of the seasonal change, with April marking the beginning of the home-buying season. It’s also possible that government delays on foreclosures, which normally sell for 20% less than market value, could be temporarily allowing averages to rise only to pull down the market later on.
The S&P/Case-Shiller report consists of 10-city and 20-city composite rankings for major metropolitan areas. The 10-city composite shows a decline of 3.1% over 2010 levels but an increase of 0.8% over March, while the 20-city was down 3.96 year-over-year and up 0.7% from March. The Index also shows that prices rose in 13 of 20 cities tracked. However, six metro areas were at their lowest price levels in four years: Charlotte, Chicago, Las Vegas, Miami, Tampa, and Detroit, the worst month-over-month performer with prices falling 2.9% off March levels. Minneapolis was the worst year-over-year performer, with prices down 11.1% over April 2010, while Metropolitan Washington D.C. continued to be the strongest of the bunch, with prices up 3% in April and up 4% year-over-year.
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