A monthly home-price index that tracks price shifts in 20 metro areas fell to a negative annual return in January, with 11 of 20 areas experiencing year-over-year declines.
The Standard & Poor’s/Case-Shiller 20-City Composite index reached 202.03 in January, which is a 202 percent gain compared to the index base value of 100 in January 2000 but represents a year-over-year decline of 0.2 percent.
The index is designed to track price changes for typical single-family homes in a given metro area by matching price pairs for individual homes from a database of sales at fair market value.
“The annual declines in the composites are a good indicator of the dire state of the U.S. residential real estate market,” said Robert J. Shiller, chief economist at MacroMarkets LLC, in a statement. A 10-City Composite index also showed negative year-over-year growth, dropping 0.7 percent compared to January 2006.
“The 10-City and 20-City Composites are both showing negative annual returns, a striking difference from the 15.1 percent and 14.7 percent returns they reported this time last year. The dismal growth in the 10-City composite is now at rates not seen since January 1994,” Shiller added.
The 10-City Composite index includes Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, New York, San Diego, San Francisco and Washington, D.C. And the 20-City Composite index includes these areas plus Atlanta, Charlotte, Cleveland, Dallas, Detroit, Minneapolis, Phoenix, Portland, Seattle and Tampa.
Detroit had an annual decline of 6.9 percent and Boston had an annual decline of 5.6 percent in January. Seattle had the highest annual gain in January at 11.1 percent, followed by Portland at 8.7 percent and Charlotte at 7.9 percent. Charlotte had the only month-to-month gain in the index from December to January, at 0.4 percent, while Detroit had the steepest month-to-month drop of 1.3 percent in January.
The National Association of Realtors trade group reported that the median price for U.S. existing homes dropped 3.1 percent in January compared to January 2006. And the median price fell 1.3 percent in February compared to the median price in February 2006.
The S&P/Case-Shiller Home Price Indices are published at 9 a.m. ET on the last Tuesday of each month. The indices are published through agreements between Standard & Poor’s, Fiserv and MacroMarkets LLC.