WASHINGTON, D.C. - Data through February 2008, released by Standard & Poor’s for its Shiller Home Price Indices, show declines in the prices of existing single family homes across the United States worsened in the second month of the new year, with 17 of the 20 now reporting MSAs posting record low annual declines, 10 of which are in double-digits.
Both of the composite indices are now reporting annual declines in excess of 12.5%. The 10-City Composite posted a new record low annual decline of 13.6%, and the 20-City Composite recorded an annual decline of 12.7%.
“There is no sign of a bottom in the numbers,” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor's. “Prices of single family homes continue to drop across the nation. All 20 metro areas were in the red for the February-over-January reading.
In addition, 19 of the 20 MSAs are still reporting negative annual returns.
The monthly data show that every one of the MSAs has now declined every month since September 2007, marking six consecutive months.
On top of that, remained steep with the declines have with eight of the 20 MSAs and both composites reporting their single largest monthly decline in February.”
For example, Las Vegas and Miami continue to be the weakest markets over the past 12 months returning -22.8% and -21.7%.
These two markets witnessed some of the fastest growth in the 2004/2005 periods, with annual growth rates peaking above +50% and +30%.
For the month of February, markets in the West such as San Francisco, Las Vegas, and Los Angeles were the worst performers.
SO WHAT DOES THIS REALLY MEAN?
First it is important to even understand what this Data is.
The S&P/Case-Shiller Home Price Indices measure the residential housing market.
They track changes in the value of the residential real estate market in 20 metropolitan regions across the United States.
These indices use the repeat sales pricing technique to measure housing markets.
First developed by Karl Case and Robert Shiller, this methodology collects data on single-family home re-sales, capturing re-sold sale prices to form sale pairs.
This index family consists of 20 regional indices and two composite indices as aggregates of the regions.
THIS IS NOT SUPRISING DATA AND IS NO CAUSE FOR CONCERN.
The fact that these homes are selling for less now than before makes perfect sense considering that many of the homes being sold right now are "Foreclosures" which sell for less because it is a forced sale and investors expect a profit.
In addition, many homes are also sold as "Short Sales' in which the home owner usually owes more on the home than it is worth (than they paid for it) so they sell it at a discount to avoid the bank from taking the home.
Simply put, this data is worthless in predicting the direction of the market for homes that are not considered "Distress Sales".
To search for bank owned properties on the market go to http://www.LAHomeSearch.com
To search for Southern California Real Estate including real estate in Beverly Hills, Brentwood, santa Monica, and Malibu go to http://www.LAHomeSearch.com
For Los Angeles Real Estate go to http://www.LAHomeSearch.com
To search for "For Sale By Owner" properties in the Los Angeles Real Estate Market visit http://www.FSBO.LAHomeSearch.com
Thinking of Selling? To get the most Money, Fastest Sale, and the Fewest Problems, visit http://www.LAHomeSearch.com
About the Author
Greg M. Ingerson, Attorney At Law & Real Estate Broker, is a real estate Broker with LA Home Search in Los Angeles, California. To learn more about the Los Angeles Real Estate Market, please visit http://www.LAHomeSearch.com
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