CNNMoney: "Home prices up for 1st time in 3 years"

By
Real Estate Broker/Owner

With all of the headlines being thrown around, often times things are taken out of context, this is one of those times.

CNNMoney.com is reporting today that according to the S&P Case Shiller home price index that home prices are up.  And they were...month over month.

Home prices were also up month over month in June according to the National Association of REALTORS.

Unfortunately, month over month changes in home prices is highly unreliable due to seasonal variances.

In fact, month over month changes are deemed so unreliable that the NAR does not even measure the percentage change on their monthly existing home sales report, they only measure the year over year change.  See here.

While admittedly it is a trailing indicator, home price changes are best measured year over year.  And what the Case-Shiller home price index revealed was that in May, home prices were down in their 10-city index by -16.8% year over year and by -17.1% for their 20 city index.  And for those who doubt the accuracy of the Case Shiller index, the NAR numbers are not much better, the NAR revealed that median home value plunged -15.4% in June from last year.

Even Moody's Mark Zandi acknowledged that, "I think it's a temporary respite, it reflects the recent decline in foreclosure sales, and prices will continue to fall over the next several months". 

 

Comments (5)

Jerry Spicer
Sonoran Property Inspections LLC - Scottsdale, AZ

I am just so darn glad that the media is reporting anything positive in the home building industry. We need to get 2 or 3 months of positive gains, even if they are small. 

Jul 28, 2009 05:08 PM
Vickie Nagy
Coldwell Banker Residential Real Estate - Palm Springs, CA
Vickie Jean the Palm Springs Condo Queen

I hear you Mark, but our market is surely heating up. We're seeing multiple offers, actually a multitude of offers on well-priced properties...sometimes over 30, over 40 offers on a single property.

Jul 28, 2009 05:58 PM
John Mulkey
TheHousingGuru.com - Waleska, GA
Housing Guru

Mark - Reporters are always ready to jump on any info that is different from the norm, and this is one of those times. While it's hearting to see a bit of positive news, the overall trend is yet to show significant improvement.

If there were solid indicators that we had encountered the housing bottom, the news might be good. As it is, it is meaningless.

Jul 29, 2009 01:03 AM
Jim Crawford
Maximum One Executive REALTORS® - Atlanta, GA
Jim Crawford Atlanta Best Listing Agents & REALTOR

It does not take into account the home sales and prices were so far down they could only look up.  Would you want to be a seller in this market? I wouldn't!

Jul 29, 2009 01:19 AM
Lou Ludwig
Ludwig & Associates - Boca Raton, FL
Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC

Hi Mark

That good news that the media is reporting positive news, But NAR numbers are of.

Good luck and success.

Lou Ludwig

Jul 29, 2009 05:17 AM