Case-Shiller: Home Price Growth Cooled in May

Case-Shiller: Home Price Growth Cooled in May

Let’s have a look at the latest data from the Case-Shiller Home Price Index. According to April data, Seattle-area home prices were:

Up 1.4% April to May
Up 9.3% YOY.
Down 12.6% from the July 2007 peak

Last year prices rose 3.1% from April to May and year-over-year prices were up 11.9%.

Although prices are still up quite a bit both month-over-month and year-over-year, May’s data actually shows some cooling compared to a month ago and a year ago.

Here’s an interactive graph of the year-over-year change for all twenty Case-Shiller-tracked cities, courtesy of Tableau Software (check and un-check the boxes on the right):

Seattle’s position for month-over-month changes fell from #2 in April to #5 in May. Tampa, San Francisco, Chicago, and Charlotte all saw home prices rise more between April and May than they did in Seattle.

Case-Shiller HPI: Month-to-Month

Hit the jump for the rest of our monthly Case-Shiller charts, including the interactive chart of raw index data for all 20 cities.

In May, nine of the twenty Case-Shiller-tracked cities gained more year-over-year than Seattle (two more than April):

  • Las Vegas at +16.9%
  • San Francisco at +15.4%
  • Miami at +13.2%
  • San Diego at +12.4%
  • Los Angeles at +12.3%
  • Detroit at +11.9%
  • Atlanta at +11.2%
  • Tampa at +10.2%
  • Portland at +10.0%

Ten cities gained less than Seattle as of May: Dallas, Chicago, Minneapolis, Boston, Denver, Phoenix, Washington DC, New York, Charlotte, and Cleveland.

Here’s the interactive chart of the raw HPI for all twenty cities through May.

Here’s an update to the peak-decline graph, inspired by a graph created by reader CrystalBall. This chart takes the twelve cities whose peak index was greater than 175, and tracks how far they have fallen so far from their peak. The horizontal axis shows the total number of months since each individual city peaked.

Case-Shiller HPI: Decline From Peak

In the eighty-one months since the price peak in Seattle prices have declined 12.6%.

Lastly, let’s see what month in the past Seattle’s current prices most compare to. As of May 2014, Seattle prices are right around where they were in February 2006.

Case-Shiller: Seattle Home Price Index

Check back tomorrow for a post on the Case-Shiller data for Seattle’s price tiers.

(Home Price Indices, Standard & Poor’s, 07.29.2014)

  

About The Tim

Tim Ellis is the founder of Seattle Bubble. His background in engineering and computer / internet technology, a fondness of data-based analysis of problems, and an addiction to spreadsheets all influence his perspective on the Seattle-area real estate market.

11 comments:

  1. 1
    BacktoBasic says:

    9% YOY *5 (assumeing leveraged w/ 20% down) plus tax reduction. Much better than stock market. Is this a bubble or not? Even best of the best hedge fund manager can’t best this.

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  2. 2

    RE: BacktoBasic @ 1 – True, except that:

    1. This number means next to nothing for any individual property.
    2. Transaction costs are high.
    3. Not exactly a liquid investment.
    4. Leverage increases risk.

    This type of news is mainly good for people who own their own home and plan on moving to a less expensive area/property or people who are still underwater and hope to avoid doing a short sale.

    Rate this comment: Thumb up 0

  3. 3
    BacktoBasic says:

    It means a lot to everyone. The Fed and IRS tax code all favor home speculator. If you own a home, not only you could enjoy appreciation, you could write off property tax, interest, ect. And in the end, you could pocket all gain tax free (250k for a couple). If you rent, you will get nothing. And your primary home is excluded from creditor, university aid calculation and many more. In a taxable account, you won’t have this kind of benefit. The transaction cost is just one time fee if you live in it forever like Warren Buffet. 30 years down the road, real estate agent as a profession might not exist anymore. You could sell your house vituraly in the cloud with min fees. All these benefit makes people rich. But on the other side, bring us to big trouble in 2008.

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  4. 4

    RE: BacktoBasic @ 3 – It’s actually 500k for a couple, and that is a great benefit, but the interest and RE tax deductions are over-rated because of needing to clear the standard deduction. Unless you have a lot of other deductions, or have a lot of interest expense and a high income tax bracket (e.g. many people who live and work in San Francisco), the interest deduction is not that great of deal.

    Don’t get me wrong–I think appreciation is good for the leveraged homeowner. I just don’t think the comparison to other types of investments is all that good, and I don’t think the primary reason to buy a house should be investment (unless maybe the goal is to some day own free and clear).

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  5. 5
    BacktoBasic says:

    The funny things about real estate is unlike other fixed asset, it appreciates. A piece of dry wall, a nail or piece of glass, won’t appreciate. They depreciate as they get rusted and used. You could say a buildable land can appreciate but we are not in shortage of land in this country. Read USnews today says 1/3 American all deep into debt. On every hwy in Seattle you see pile of traffic from people from south to work in the north or verse vesa. I could blame all these to Fed and IRS tax code. People will speculate and gamble if fiscal policy make them over extend their debt and attach to a wood box further from their work place. I lived in Germany before, majority of people rent and live nearby their work place. The rent increase is caped. Hwy is very congested like here. Gas is enpensive for sure but people take public and no complain. You can’t speculate a house and food and all necessity, never the less the tax code encourage people to do so. We are not an angricuture state any more that needs people to own a piece of land and stay for life. The new economy policy should give incentive to labor force mobility. Not real estate speculator.

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  6. 6
    redmondjp says:

    By BacktoBasic @ 5:

    The funny things about real estate is unlike other fixed asset, it appreciates…

    Unless it is in a place where nobody wants to live, like Flint or Detroit. I think you may find a few people in those places who might disagree with your assertion.

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  7. 7

    RE: BacktoBasic @ 1

    LOL

    The stocks went up 23% alone in 2013….homes sure didn’t….

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  8. 8

    By softwarengineer @ 7:

    RE: BacktoBasic @ 1

    LOL

    The stocks went up 23% alone in 2013….homes sure didn’t….

    You’re missing the reference to leverage in that post. Of course, you could buy stock on margin and get similar leverage (but not similar tax treatment).

    That said, I still don’t like that first post comparing investing in stocks to owning a house for the reasons mentioned before.

    Rate this comment: Thumb up 0

  9. 9
    No Name Guy says:

    Roll over…..

    What’s that? Sound of this echo bubble starting to pop? I’ll venture a prediction – that the cooling will continue on a YoY basis, with smaller and smaller YoY gains, until by the end of this year, it’s YoY declines.

    I missed my last chance to buy rental property dirt cheap, since I wasn’t in a position to do so at the time. But I’m all set now……just need to get those prices back to where it’ll pencil out. Since my personal residence is owned free and clear and is merely shelter to me, I don’t care what happens to its “price” – its utility value as shelter is constant.

    Back – yeah, leverage is a great thing….as long as you’re on the right side of the movement. That 4:1 leverage is great, if you’re right on direction. Have it move against you by a few percentage points, and watch out…it’ll cut you in half fast.

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  10. 10
    whatsmyname says:

    By BacktoBasic @ 5:

    We are not an angricuture state any more that needs people to own a piece of land and stay for life. The new economy policy should give incentive to labor force mobility.

    Plus they can buy what they need at the company store!

    Let’s be like Germany where people rent close to work, and the ownership society doesn’t get too bogged down with the workers owning too much. That is just confusing to the real owners. Weird that their highways are “very congested like here”, though.

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  11. 11
    whatsmyname says:

    RE: No Name Guy @ 9
    You should sell that free and clear house of yours, and buy a better one after the pop.

    Or you can buy the same one back, and use the extra dough to go drinking with Erik.

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