Evidence of a Bottom: Price Declines Keep Slowing Down

• July 28th 2009

by Will Smith

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This is the second time in two weeks that we’ve gotten the opportunity to use that up-arrow graphic for an UrbanTurf article. Today our reason is the Case-Shiller Home Price Index, whose publication this morning included hopeful data about the national housing market. The two key takeaways are:

Across the 20 major metropolitan markets measured by Case-Shiller, home prices actually rose from April to May. It’s the first time in three years that Case-Shiller has recorded a broad increase in prices. Granted, month-over-month does not account for seasonality and, furthermore, a slight uptick (0.5 percent) in prices during a single month does not a trend make. But still, the first actual increase in three years is worth noting.

May marks the fourth month in a row that year-over-year price declines have lessened, which is strong evidence that prices are stabilizing. To be clear, year-over-year prices are still falling. In fact, 16 of the 20 measured markets are still reporting double-digit declines. But price declines have to slow before they stop altogether, so the trend is encouraging. The graphic below illustrates this point. Note the inflection at the bottom right, which shows how four months ago annual declines maxed out at just shy of 20 percent but since then have receded.

As for Washington, DC, May was the second month in a row that our area saw slight appreciation (1.3 percent). Following are the numbers for all 20 cities, and here is the full Case-Shiller report.

This article originally published at http://dc.urbanturf.production.logicbrush.com/articles/blog/evidence_of_a_bottom_price_declines_keep_slowing_down/1180.