January Case Shiller Data Atrocious: "At Worst, The Feared Double-Dip Recession May Be Materializing"

Tyler Durden's picture

Case Shiller data is out, and it is as horrible as ever. The Home Price Index came at 140.86 compared to 142.42 previously. Basically the double dip refuses to stop, and that even despite yesterday's "stunning"(ly irrelevant) pending home sales number.“Keeping with the trends set in late 2010, January brings us weakening home prices with no real hope in sight for the near future” says David M. Blitzer, Chairman of the Index Committee at Standard &  Poor's. “With this month’s data, we find the same 11 MSAs posting new recent index lows. The 10-City and 20- City Composites continue to decline month-over-month and have posted monthly declines for six consecutive months now. “These data confirm what we have seen with recent housing starts and sales reports. The housing market recession is not yet over, and none of the statistics are indicating any form of sustained recovery. At most, we have seen all statistics bounce along their troughs; at worst, the feared double-dip recession may be materializing."

http://graphics.thomsonreuters.com/11/03/US_CSHS0311_SB.jpg

From the release:

"Data through January 2011, released today by Standard & Poor’s for its S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices, show further deceleration in the annual growth rates in 13 of the 20 MSAs and the 10- and 20-City Composites compared to the December 2010 report. The 10-City Composite was down 2.0% and the 20-City Composite fell 3.1% from their January 2010 levels. San Diego and Washington D.C. were the only two markets to record positive year-over-year changes. However, San Diego was up a scant 0.1%, while Washington DC posted a healthier +3.6% annual growth rate. The same 11 cities that had posted recent index level lows in December 2010, posted new lows in January."

The chart above depicts the annual returns of the 10-City and the 20-City Composite Home Price Indices. In January 2011, the 10-City and 20-City Composites recorded annual returns of -2.0% and -3.1%, respectively. On a monthly basis, the 10-City Composite was down 0.9% and the 20-City Composite fell 1.0% in January versus December 2010. Only San Diego and Washington D.C. posted positive annual growth rates in January 2011. These are the only two cities whose annual rates remained positive throughout 2010. Every other MSA has either moved back into or has always been in negative territory during the recent housing crisis. On a monthly basis, Washington DC was the only market where home prices rose in January, but up only 0.1%. The remaining 19 MSAs and both Composites fell during the month, with 12 of the markets and the 20-City Composite down by at least 1.0% versus December 2010.

“Keeping with the trends set in late 2010, January brings us weakening home prices with no real hope in sight for the near future” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor's. “With this month’s data, we find the same 11 MSAs posting new recent index lows. The 10-City and 20- City Composites continue to decline month-over-month and have posted monthly declines for six consecutive months now.

These data confirm what we have seen with recent housing starts and sales reports. The housing market recession is not yet over, and none of the statistics are indicating any form of sustained recovery. At most, we have seen all statistics bounce along their troughs; at worst, the feared double-dip recession may be materializing. A few months ago we defined a double-dip for home prices as seeing the 10- and 20-City Composites set new post-peak lows. The 10-City Composite is still 2.8% above and the 20-City is 1.1% above their respective April 2009 lows, but both series have moved closer to a confirmed double-dip for six consecutive months. At this point we are not too far off, and that is what many analysts are seeing with sales, starts and inventory data too.

Pretty much says it all. Full report.

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SheepDog-One's picture

And highly likely DC soon will be burning.

umop episdn's picture

I think that you've already seen this particular travesty of a bankster morality play. Don't spoil the ending for the rest of us. ;-)

oh_bama's picture

What is he talking about?

  • REcession has been over for 2 YEARS!!
  • And wealth effect is GREAT!
  • PEOPLE FEEL RICH!!
Coast Watcher's picture

You forgot the "/sarcasm" at the end.

Oh regional Indian's picture

Everyone can start by calling it a DEPRESSION. The greatest ever, just cannot see it that way because SNAP is operational and Stars are dancign on ice and in Joe and Jane's eyes.

Double-dip, I'm sure most people thinlk tea-bags or ketchup when they hear that. Clever distraction deflection verbiage.

It's a DEPRESSION. Let's get over that hurdle already.

ORI

http://aadivaahan.wordpress.com/2011/03/28/for-dis-believers/

Trillax's picture

Agreed, ORI.  Let's call a spade what it is: a depression that everyone is in denial over; and I'm not talking about the river in Egypt.  I understand the cycle of grief and people need to come to terms with it, however the time is nigh to finally (and collectively) pull our head out of our ass.

It is a depression. No matter how TPTB want to 'paper over' the facts.

Harlequin001's picture

well I think it's rather bullish...

Just fills me with the urge to go out and buy a new house...

and to see if I can't find a bigger depth charge to strap my life savings to...

DeadFred's picture

My first thought when I saw the graph was "who got to name this a double dip?"  That anemic upturn isn't very impressive.  Terms like head fake and dead cat came to mind.  How much of that blip was the tax credit?  It looks like there's still a very big elephant in the room with us.  Let's talk about Libya instead.

Harlequin001's picture

doesn't that look just like the early part of the DOW chart 1929 -1940....

How uncanny...

Capitalist10's picture

Seriously, the only folks doing well are those sucking at the government tit in DC.  Time for some tar and feathers.

Harlequin001's picture

Well actually Capitalist10, gold investors are doing OK as well...

so if you're a government employee who invested in gold, I should think you'd be more than a little happy...

slow_roast's picture

As soon as the government shuts down all those government workers who are "taking time off" can join the throngs of DC citizens in smoking crack and living on the streets.  Joy to the world.

TheGreatPonzi's picture

"Cash buyers" of 2009-2010 are now officially raped. Quite predictable. 

silvertrain's picture

More rental untits comming right up..

MachoMan's picture

In 09, we saw quite a bit of cash on the sidelines here piling into local low end residential properties for rental speculation.  Essentially, older folks shifted money from CDs into houses because the rental income paid a higher % than they could get on their money otherwise...  Recently, I think our market has gotten a little softer whereby these people are starting to hit the exits...  not a lot, but definitely starting to fray around the edges.

I do believe there will be a day of some semblance of price discovery...  but we've yet to see it.

Don Birnam's picture

A neighbor of ours ( a retired gent ) engaged in the very transaction you describe: purchased a single-family property in late '08, for the rental income. The home, however, is situated in a plat in which the properties had been going for >450k during The Bubble's zenith; he likely bought lower than that, but I suspect the home has not appreciated at all, and the necessity for a premium rental rate ( the standard rates run likely $500 or so less ) has resulted in the place being vacant for several-month stretches at a time ( as it is now ).

Frankly, real estate speculation is perhaps the sharpest of falling knives for a speculating neophyte to catch. Yet, as you remark, some intrepid retirees seek this option, if income is desired; CD rates being essentially nil...but then there is that return of capital thing, isn't there ?

 

 

Pool Shark's picture

 

Housing bottoms are really easy to spot; they're very wide, shallow curves. You can be nearly two years late in buying into them and still miss very little appreciation on the recovery.

Anyone who has studied this knows that the V-shaped 'bottom' in '09 was a head-fake. Just like anyone who bought the V-shaped 'bottom' in '91 missed the true bottom which didn't come until '96 (at least in California).

The real bottom in this market won't be here until 2014 (at the earliest). All you have to do is look at Shiller's chart of inflation-adjusted home prices going back over 100 years to see this: the housing bust cycle always lasts longer than the boom.

Even Cramer should have seen this... but of course, he's Cramer...

 

 

Harlequin001's picture

Pool shark, I would say that the housing boom is now finished for at least one generation, maybe two...

Pool Shark's picture

 

I agree Harlequin.

What I'm saying is that we're still at least a few years away from a bottom. After that, I don't expect any significant appreciation, or 'boom;' just a bottoming.

Unless, of course, the economy flies apart (good possibility); then all bets are off, and lookout below...

  

Harlequin001's picture

yes old stick, currently donning my poo-proof pants as we speak...

and heading for the pub.

Dnice0123's picture

Walt Clyde Frazier, is that you?

Harlequin001's picture

in fact I seem to remember that it was predicted, many times right here on ZH...

lizzy36's picture

But pending home sales as reported yesterday were up 2.4%. Beating expectations.

We need to cling to this positive data point as evidence that the dreaded double dip (which presumes the first dip ended) will not come to fruition.

Tyler Durden's picture

Furthermore, you can/can't eat plutonium. Ths is deflationary/inflationary.

Spalding_Smailes's picture

What's up with gold ? All the swans are blocking out the sun in Chicago ....

 

Can you call up Lear and get some insider info ....

Pegasus Muse's picture

It looks like you have again prematurely ejaculated your gold bashing jizz.  It must be tough 'cause you get so few opportunities to whip it out.  And when you do it is always a disappointment. 

This might help:  http://1.bp.blogspot.com/_pi6QiEpOQOg/S4ycqbh54HI/AAAAAAAAAbM/Vd-FpHNlkyE/s320/ill_extenze2.jpg 

PM Miners just went green on the day.

 

Spalding_Smailes's picture

Gold was in the same range OCT 20th, with all the new black swans we should be over $1,700 by now .....

Attitude_Check's picture

The action has been in Silver the last few months.  That will probably continue as the Gold/Silver ratio approaches 15 (Implying a much higher silver price if Gold stays range-bound).  That will change however, though it might be awhile.

Harlequin001's picture

Hey Spalding, I answered that here at 9.01. You posted this at 10.36 having not answered my earlier post which deals specifically with this comment...

http://www.zerohedge.com/article/massive-raw-gold-shortage-china-supply-...

Got you sussed old stick...

Harlequin001's picture

Hey Spalding, I answered that here at 9.01. You posted this at 9.38 having not answered my earlier post which deals specifically with this comment...

Got you sussed old stick...

JLee2027's picture

As Mark Twain said, "there are lies, damn lies, and statistics." Which means you can make "statistics" say anything you want with data manipulation.

johnQpublic's picture

...but only 50% of the time...ask 80% of the people...90% of them will say this

TheMerryPrankster's picture

Coincedentally, the Obama administration just announced their latest economic recovery plan in coordination with the Federal Reserve. It only had 4 bullet points.

 

1. Lies

2. Damn lies

3. Statistics

4. Rinse & Repeat

 

I'm not a partisan fan of either tbtf political party, but it appears this plan was directly stolen from the Bush Adminstration, who used it sucessfully in 2 foreign wars AND domestic economic planning.

firstdivision's picture

Double Dip?!?  I only see a dead cat bounce.

Ruffcut's picture

They say you can have a L shaped recovery.

The new normal. Positive is negative, just reverse the polarity.

qmhedging's picture

Need some Chinese buyers.Give free visa

SilverDOG's picture

Assuming western stupidity has spread to Asia.

Tortfeasor's picture

Have you seen the overdevelopment in China?

crazyjsmith's picture

yeah, we did export something to China.  It's called Irrational Exuberance.

jkruffin's picture

Hopefully, everyone across the nation is writing their Congressional leaders and demanding the end to the QE experiment for good. It has only helped the wealthy stock owners of the highest levels, and the other 95% of the people are paying more for everything and have nothing, many not even a job.  This has to stop.  Trying to force a recover at the expense of the people must end.

HedgeYourself's picture

Agree with it should be ended. I fail to see how that will help housing though. Reverse to Bullard's slides will happen - interest rates will rise (potentially substantially, depening on debt appetite), stocks will tank, commodities will tank, housing will tank (driven by interest rates and backed up with upcoming of waves of foreclosures due to rate resets), commodities will tank. Dollar will gain :)

Or, what outcome you would expect ?

 

 

Godot's picture

"Hopefully, everyone across the nation is writing their Congressional leaders and demanding the end to the QE experiment for good......  This has to stop.  Trying to force a recover at the expense of the people must end."

Congress cannot control QE, as you know or should know.  They can, however, control the terms of trade agreements, which is where most jobs have been lost (that and productivity itself).  So, why not go after the real culprit instead?

 

barkster's picture

My congressman listen to me?  BAHAHAHAHAHAHAAAA! That was a joke, right?

baby_BLYTHE's picture

We're going into a Depression!

Long-John-Silver's picture

Going? We've been in one for a couple of years.

WonderDawg's picture

The depression started 2007-2008. We had a Fed manufactured reprieve, but they fixed nothing, only delayed the inevitable and magnified the ultimate damage. I think future generations will refer to what we are about to experience at The Great Collapse.

Neoisolationist's picture

Hey Blythe, that's going to happen regardless. the sooner it hits the easier it'll be. Massive hyperinflationary collapse a year from now (or two ) will be much worse to deal with then going into a depression now.

DutchTreat's picture

Oops, what a catch 22 for Ben: should I keep interest rates low to (try to) save home owners or raise (to try to) avoid inflation.