U.S. home prices plunged 8.9 percent in the fourth quarter of 2007 compared to the prior year’s quarter — it was a record in the 20 years of data collected, according to a Standard & Poor’s/Case-Shiller price index report released today.
The national index sank 5.4 percent from the third quarter in 2007 to the fourth quarter in 2007, and the year-over-year drop in the fourth quarter was far larger than the 2.8 percent annual rate of decline for the index reported during the 1990-91 housing recession.
“We reached a somber year-end for the housing market in 2007,” Robert J. Shiller, Yale University professor and chief economist at MacroMarkets LLC and a co-creator of the index, said in a statement. “Home prices across the nation and in most metro areas are significantly lower than where they were a year ago.”
A separate, monthly index that measures price changes for 20 U.S. metro areas declined 9.1 percent in December 2007 compared to December 2006, while a 10-city index dropped 9.8 percent. Three of the metro areas in the 20-city index had year-over-year price gains in December 2007: Charlotte, up 2.3 percent; Portland, up 1.2 percent; and Seattle, up 0.5 percent.
Seven of the 20 metro areas in that index had double-digit year-over-year price declines, according to the index report. Miami led the list with a 17.5 percent index price drop from December 2006 to December 2007. Next on the list were Las Vegas and Phoenix with a 15.3 percent decline; San Diego, down 15 percent; Detroit, down 13.6 percent; Tampa, Fla., down 13.3 percent; and San Francisco, down 10.8 percent.
All 20 metro areas had a monthly price decline in December 2007 compared to November 2007, according to the index report, and Phoenix topped the list with a 3.4 percent decline, followed by San Diego with a 3.4 percent decline and San Francisco with a 3.2 percent decline.
The Case-Shiller price indices are based on a comparison of multiple sales at fair market value for the same homes over time.
The National Association of Realtors announced in a separate report that U.S. median single-family resale home prices dropped 5.8 percent in the fourth quarter compared to the same quarter in 2006. And the median existing single-family home price dipped 6.5 percent in December 2007 compared to December 2006.
Meanwhile, the U.S. Census Bureau reported that the median sales price of new homes dropped 10.4 percent in December 2007 compared to December 2006.
S&P/Case-Shiller price index report
Source: S&P/Case-Shiller home-price indices.