S&P/Case-Shiller for April 2011
A double dip in the housing market is becoming a reality as home prices nationwide fell 4 percent from April of 2010, according to the S&P/Case-Shiller Home Prices Index. The decline was the most in more than a year.
There is a risk of home prices falling even further due to decreasing sales, a large backlog of foreclosures and a recent decline in consumer spending. Robert Shiller, one of two economists who created the index, told a conference this month that a drop of 10-25 percent in home values over the next five years would not be surprising.
On the positive side, numerous cities saw month-to-month gains, although the gains are likely due to seasonal changes in that market and the annual gain or loss is more telling of the housing market in general. Only one of the 20 cities that make up the 20-City Composite of metropolitan areas saw annual house prices rise in April. Washington D.C.’s home prices grew 4 percent between April of 2010 and April of 2011.
“This month is better than last,” said David Blitzer, chairman of the index committee at S&P, in a statement. “However, the seasonally adjusted numbers show that much of the improvement reflects the beginning of the spring-summer home buying season. It is much too early to tell if this is a turning point or simply due to some warmer weather.”
The S&P/Case-Shiller Home Price Indices are released the last Tuesday of each month. They are published with a two-month lag.
Editor’s Note: All data is from Standard & Poor’s Case-Shiller index of home values.