Data through November 2009, released today by Standard & Poor’s for its S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices, show that the annual rates of decline of the 10-City and 20-City Composites continue to improve, in spite of price declines being measured across many markets during November. This marks approximately 10 months of improved readings in the annual statistics, beginning in early 2009, and is the third consecutive month these statistics have registered single digit declines, after 20 consecutive months of double digit declines.
November data showed that from October to November, Denver's home price index fell 0.5%, and fell 0.4 percent from September to October. However, when compared year over year, November's index showed an increase of 0.5 percent, which places Denver behind only Dallas and San Francisco in the 20-city index.
“While we continue to see broad improvement in home prices as measured by the annual rate, the latest data show a far more mixed picture when you look at other details.” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “Only five of the markets saw price increases in November versus October. What is more interesting is that four of the markets – Charlotte, Las Vegas, Seattle and Tampa – posted new low index levels as measured by the past four years. In other words, any gains they might have seen in recent months have been erased and November is now considered their current trough value. On the flip side, there are still some markets that continue to improve month-over-month. Los Angeles, Phoenix, San Diego and San Francisco have seen prices increase for at least six consecutive months. Looking at the annual figures, four markets – Dallas, Denver, San Diego and San Francisco – have finally entered positive territory, something we really haven’t seen in at least two years in most markets."
In existing home sales data recently released by the Colorado Association of Realtors, Colorado home prices were shown to have increased 18 percent in year-over-year December figures. Metro Denver figures alone showed an increase of 14 percent for the same period.
The divergence in results is due to the fact that existing home price data from Realtor's associations are based only on existing home sales reflected in completed sales sold through the Metrolist system. Case-Shiller data employs a more complex methodology.
Nevertheless, the fact that both reports show Denver with increasing home prices supports a conclusion that home prices in Colorado and in the Denver area are increasing, and outperforming many metropolitan areas throughout the United States.
But recent month-over-month declines in the index indicate sustained downward pressure on home prices in the near term.