A national home-price index fell 0.7 percent in the fourth quarter and ended 2006 at 0.4 percent annual growth.

 

This Standard & Poor’s/Case-Shiller U.S. Home Price Index declined steeply throughout 2006, falling to near-zero growth after peaking at about 16 percent year-over-year growth in 2005.

S&P/Case-Shiller also publishes 10-City Composite and 20-City Composite indices that measure home prices in select metro markets.

The indices are designed to track the price changes of typical single-family homes and are based on data for single-family home resales for homes that have two or more recorded sale transactions at fair market value. Condominiums, co-op and new-home sales are excluded from the indices, and no appraisal data are used.

The 10-City Composite Index, which includes Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, New York, San Diego, San Francisco and Washington, D.C., fell to a zero growth rate in December compared to the same month in 2005, hitting its lowest level since March 1996. The 10-city index dropped 0.8 percent from November to December.

In December, S&P announced the launch of the 20-City Composite, which added Atlanta, Charlotte, Cleveland, Dallas, Detroit, Minneapolis, Phoenix, Portland, Seattle and Tampa to the original 10 cities. The 20-City Composite Index dropped 0.7 percent from November to December while experiencing a 0.5 percent annual return in 2006.

Nine of the 20 cities in the 20-city index experienced a negative return in 2006. There was a 5.9 percent negative return in Detroit, 5.1 percent in Boston, 4.2 percent in San Diego, 2.9 percent in Washington, D.C., 2.4 percent in Cleveland, 1.4 percent in San Francisco, 0.8 percent in Minneapolis, 0.3 percent in Denver and 0.1 percent in New York in 2006.

The indices have a base value of 100 in January 2000, so that an index value of 150 translates to a 50 percent appreciation rate for a typical home in a market area.

In the 20-cities index, Detroit had the lowest index score at 119.51 in December, followed by Cleveland at 119.77, Dallas at 123.67, Charlotte at 128.88 and Atlanta at 134. Miami had the highest index score at 280.87 in December, followed by Los Angeles at 270.03, Washington, D.C., at 240.28, San Diego at 238.07 and Las Vegas at 231.57.

The quarterly U.S. Home Price Index is a composite of single-family home-price indices for all nine U.S. Census divisions. The indices are published through agreements between Standard & Poor’s, Fiserv and macroMarkets LLC.

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