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Case-Shiller Has Longest Home Price Decline Stretch Since 2012; 13 Of 20 Cities See Price Drops

Tyler Durden's picture




 

What a difference Seasonally adjusted and Unadjusted data makes: for the best example look no further than the just released latest Case Shiller index, where the Seasonally Adjusted 20 City Composite Index grew by a less than expected 0.76% (Exp. 0.80%), down from the 0.80% last month, and the Year over Year price also missed expectations of a 13.00% increase, printing slightly less at 12.86%. However, while the well-delayed February data was a modest miss across the board, more importantly it represented that there has been price increases for 24 consecutive months. One gets a very different story if one looks at the NSA data, where Y/Y prices increased the same, or 12.86%, however on a sequential basis, prices have now declined for 4 months in a row - the longest negative stretch in actual home prices since March 2012.

What's worse, even Case Shiller itself appears to have given up on housing as the driver of the wealth effect: "Five years into the recovery from the recession, the economy will need to look to gains in consumer  spending and business investment more than housing. Long overdue activity in residential  construction would be welcome, but is certainly not assured."

Here is the quite attractive Seasonally Adjusted data:

And the not quite so attractive Unadjusted data:

And some color from the February Case Shiller report itself:

“Prices remained steady from January to February for the two Composite indices,” says David M.  Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices. “The annual rates cooled the  most we’ve seen in some time. The three California cities and Las Vegas have the strongest increases  over the last 12 months as the West continues to lead. Denver and Dallas remain the only cities which  have reached new post-crisis price peaks. The Northeast with New York, Washington and Boston are  seeing some of the slowest year-over-year gains. However, even there prices are above their levels of  early 2013. On a month-to-month basis, there is clear weakness. Seasonally adjusted data show prices  rose in 19 cities, but a majority at a slower pace than in January.

 

“Despite continued price gains, most other housing statistics are weak. Sales of both new and existing  homes are flat to down. The recovery in housing starts, now less than one million units at annual rates,  is faltering. Moreover, home prices nationally have not made it back to 2005. Mortgage interest rates,  which jumped in May last year and are steady since then, are blamed by some analysts for the  weakness. Others cite difficulties in qualifying for loans and concerns about consumer confidence.  The result is less demand and fewer homes being built.

 

“Five years into the recovery from the recession, the economy will need to look to gains in consumer  spending and business investment more than housing. Long overdue activity in residential  construction would be welcome, but is certainly not assured.

Finally, the data breakdown by city, where 13 of 20 cities saw their prices decline:

Only five cities saw their annual rates improve in February. After posting annual gains of over 20%  for their twelfth consecutive month, Las Vegas and San Francisco both showed deceleration in their annual rates. San Diego narrowed the gap with a return of 19.9%. Washington D.C. recorded its eight consecutive improvement with an annual rate of 9.1%, its highest since May 2006.
 
Thirteen cities declined for the month of February. Cleveland and Tampa showed their largest  declines of 1.6% and 0.7% since January 2012. Seattle improved from a decline of 0.8% in January to  an increase of 0.6% in February. Denver posted a small decline and is less than one percent away  from its peak set in September 2013. Dallas increased 0.2% and continues to reach new index highs.  Detroit remains the only city below its January 2000 level.

Source: Case-Shiller

 

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Tue, 04/29/2014 - 09:25 | 4707341 Typing Typer
Typing Typer's picture

"Five years into the recovery..."

Five years into uninterrupted depression is more like it.

Tue, 04/29/2014 - 09:27 | 4707347 Scarlett
Scarlett's picture

yeah, the propaganda is unbearable.  

 

Also this....  http://bitcoin.mit.edu/announcing-the-mit-bitcoin-project/

MIT goes bitcoin.

Tue, 04/29/2014 - 09:28 | 4707352 LawsofPhysics
LawsofPhysics's picture

MIT?  Really?  Well, once all the ivy league schools jump on the bandwagon, it should be clear to eveyone that cryptocurrencies are a wet dream for the status quo.  Remind me, how many Federal Reserve chairmen have come from fucking Princeton again?

Tue, 04/29/2014 - 09:36 | 4707380 I am more equal...
I am more equal than others's picture

 

 

 

If interest rates were at normal levels - not the manipulated levels we have now - there would have been no "recovery."   Culling of unproductive assets would have ocurred and we would be better off in the long run.  Unfortunately, the short run 'cure' is preferred without considering the consequences. 

Tue, 04/29/2014 - 09:42 | 4707406 LawsofPhysics
LawsofPhysics's picture

Yes.  Real consequences for bad behavior?  That's only for the little people and working stiffs...

 

Unfortunately, without forcing all the bad management and bad ownership to go bankrupt, sell their assets, and be replaced with new manangement, these fuckers will continue to rape the taxpayer and destroy what's left of the "market" and U.S. treasury...

Full Faith and credit bitchez...

No more faith means no more credit motherfuckers...

hedge accordingly.

Tue, 04/29/2014 - 10:36 | 4707641 SumTing Wong
SumTing Wong's picture

We've bought the cancer and sold the car crash...but cancer is a real bitch. We've lost a couple family members to it recently.

Tue, 04/29/2014 - 11:48 | 4707672 ricky663
ricky663's picture

Don't forget that they threw out the rule of law re: MERS - Mortgage Electronic Registration Systems. MERS, a Frankenstein monster, created by the banks allowed them to F up (cloud) title on millions of homes so that they could more easily securitize mortgages and make more $$$. Also allowed them to bypass the county recorder, and the counties lost millions in fees.

There have been some court cases, but nothing that really gained any meaningful traction. Then, the "fines" and "settlements" came 'tween the State AGs and banks, and it (this issue) all just went "poof!"

This issue really got my attention along with all of the bailouts/TBTF, etc.  Just goes to show you who is really in charge! (Just try to trick a bank out of a home with funny paperwork, and see what happens to you!).

Extra credit: check out the headlines at www.mersinc.org:

 

Tue, 04/29/2014 - 15:08 | 4708988 Aussiekiwi
Aussiekiwi's picture

'Unfortunately, the short run 'cure' is preferred without considering the consequences. '

Which also sounds like what is occurring in the Ukraine.

Tue, 04/29/2014 - 09:40 | 4707395 Global Hunter
Global Hunter's picture

Further to LawsofPhysics post, Larry Summers was the president of Harvard

Tue, 04/29/2014 - 09:27 | 4707351 rsnoble
rsnoble's picture

Democrats have been told not to mention the 'recovery' in any upcoming campaigns because it's widely known as bullshit by most people now.

Tue, 04/29/2014 - 09:56 | 4707468 corporatewhore
corporatewhore's picture

As if Republicans have any alternative.  Pleeeeeeeeease give it up

Neither has an answer.

Tue, 04/29/2014 - 10:18 | 4707554 rsnoble
rsnoble's picture

You're missing the point entirely.  I hate both parites.  What I said is what democrats are being told-------not a debate on which group of clowns is better.

Tue, 04/29/2014 - 09:42 | 4707405 TideFighter
TideFighter's picture

D.C. will crash if the Bureau of [insert anything] is closed. We can start by closing the BLM and giving their property back to the states, for auction and use by 'Merikans.

Tue, 04/29/2014 - 09:26 | 4707348 rsnoble
rsnoble's picture

20 out of 20 cities are raising personal real estate taxes or are trying to so the fucking parasites may continue to have bloated wages and benefits at the expense of everyone else in the real world.

Tue, 04/29/2014 - 10:25 | 4707593 rsnoble
rsnoble's picture

For instance glancing at the 'shrunken' employment wanted section in the local paper this am I see jobs for $9hr cooks, an $11 pkg handler, a get rich scheme of some kind, AND 4 city jobs with the lowest paying one $48k with full benefits.

So let's get this straight............the cook, the goinpostal guy, and the guy that gets ripped off trying to get rich quick get to support the 3 city jobs that are probably around $200k a year all toghether. 

These fuckers are the only group that can keep what they got simply by raising taxes and selling your shit if you don't.

I have a 7 year old fishing boat that I paid $12k new for, they still value it at 9.5k and the taxes on it are $500 a year!  And if I don't pay them I can't get car tags lol.  They got everything figured out.  That's why I support collapse fast otherwise they will slow bleed everone into tent city before they finally start taking  hits.

Tue, 04/29/2014 - 09:30 | 4707357 thedrickster
thedrickster's picture

And with mortgage rates at 4.3%.

Tue, 04/29/2014 - 09:31 | 4707358 fonzannoon
fonzannoon's picture

Shiller sounded completely freaked out on CNBC. They tried to fondle his balls a few times and cheer him up but he was not having it.

Tue, 04/29/2014 - 09:34 | 4707373 valley chick
valley chick's picture

But somehow this is bullish!  Smh

Tue, 04/29/2014 - 09:37 | 4707382 Dr. Engali
Dr. Engali's picture

Maybe it's because he doesn't have a pair. He did sound kind of shrill and high pitched.

Tue, 04/29/2014 - 09:42 | 4707403 RSloane
RSloane's picture

This constitutes an emergency! Bring in teh Becky!

Tue, 04/29/2014 - 10:10 | 4707528 Cpl Hicks
Cpl Hicks's picture

Yes. It was his usual talking out of both sides of his mouth with him completely forgetting how to work an earpiece.

Doesn't he just make you feel so confident in the Nobel- winning geniuses of the world?

Tue, 04/29/2014 - 10:27 | 4707600 rsnoble
rsnoble's picture

Why us he worried on POMO day?  Doesn't he know the masters of the digital zero universe got is back? LMAO.

Tue, 04/29/2014 - 09:33 | 4707368 madcows
madcows's picture

So year over year prices are up 13%.  I didn't get a 13% raise, so I'm guessing houses are becoming less affordable.  FORWARD!, and RECOVERY!

Tue, 04/29/2014 - 09:44 | 4707412 LawsofPhysics
LawsofPhysics's picture

Doesn't really fit with the "inflation is tame" propaganda does it?

Tue, 04/29/2014 - 09:34 | 4707372 MFL8240
MFL8240's picture

This is the Obama recovery and still the media gives this disaster a pass!  The Federal Reserve has pumped its balance sheet over 4 TRILLION and still the country flounders.  Think it’s time for a real change?  I mean, no more democrats or republicrats, we need a third part interested in the problems of America not stirring up hatred and race riots!

Tue, 04/29/2014 - 09:39 | 4707390 the not so migh...
the not so mighty maximiza's picture

We went threw this allready, agent provocateurs will come in and screw things up for their masters.  There is no hope in this system.

Tue, 04/29/2014 - 09:39 | 4707391 Dr. Engali
Dr. Engali's picture

Yeah good luck with that looking to gubbermint, any gubbermint,  to fix things. Let me know how that works out.

Tue, 04/29/2014 - 09:41 | 4707399 disabledvet
disabledvet's picture

Oooops.

How about a little war on the Eastern Front with that?

Let's not forget out glory days in North Africa as well.

Tue, 04/29/2014 - 09:35 | 4707376 madcows
madcows's picture

Funny, prices in detroit are up 15.5%.... You can now buy a house for $1,150.  No thanks.

Tue, 04/29/2014 - 10:16 | 4707546 rsnoble
rsnoble's picture

Why wouldn't you buy that!  You can rent it out for $850 month!! LOL.

Tue, 04/29/2014 - 09:35 | 4707378 Dr. Engali
Dr. Engali's picture

"One gets a very different story if one looks at the NSA data,"

 

I thought it was the NSA who looked over our data.

Tue, 04/29/2014 - 09:48 | 4707434 machineh
machineh's picture

Seriously, though, seasonal adjustment is done for a reason.

If the author of the post disagrees with Case-Shiller's seasonal adjustment, he can propose a better one.

But making inferences from NSA data is just wrong. It's like citing a 90-degree day in August as evidence of global warming.

Tue, 04/29/2014 - 09:50 | 4707441 the not so migh...
the not so mighty maximiza's picture

just use yoy and fuck phony seasonal adjusting

Tue, 04/29/2014 - 15:02 | 4708963 Aussiekiwi
Aussiekiwi's picture

I thought the NSA had all the data, how could they be wrong?

Tue, 04/29/2014 - 09:52 | 4707456 Ban KKiller
Ban KKiller's picture

Welcome to the new America. Best housing market happens to be where the majority of fascists live....Hmmm. 

Short insurance companies that insure Greenwich.

Tue, 04/29/2014 - 10:01 | 4707497 Life of Illusion
Life of Illusion's picture

 

the economy will need to look to gains in consumer spending and business investment more than housing

Will FED buy Corp bonds?

 

Tue, 04/29/2014 - 10:02 | 4707504 TheFreeLance
TheFreeLance's picture

As I've said before, I track vacation properties in the Blue Ridge which seem to be VERY sensitive to lending/income/general well-being etc. Very telling that a 2000sq ft home on THREE acres in TN that went for maybe $250K a few yrs ago is quietly being shopped at $50K -- as is. The "as is" part is important as it means the owner has already walked away.

The 08 crash destroyed financial wealth, the next one will wipe out big hunks of physical plant and housing stock. Cash is king -- with $100K you could by a nice retirement home and two nearly new BMWs coming off lease. Might actually do that myself, come to think of it.

Tue, 04/29/2014 - 10:14 | 4707542 Kreditanstalt
Kreditanstalt's picture

What if you DON'T live in one of these big cities?  Do you count?

 

Tue, 04/29/2014 - 12:12 | 4708093 IREN Colorado
IREN Colorado's picture

We are barely treading water as an economy. The old indicies that indicated a expanding economy are either no longer working or are simply being manipulated to perpetuate the myth of recovery. When Obamacare, high energy, and new taxes are fully absorbed by the economy the end will be nigh.

Our kids should butcher US for what we are doing to their country. If only we could convince them get to put down the game controls and move off the couch....

This will not end well.

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