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CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP

Case-Shiller home prices officially double-dipped in the March data, reported this morning.  This was not a great surprise considering we saw the Corelogic HPI double-dip in January.  The Case-Shiller 20-city NSA series fell -0.77% in March versus February and -3.6% versus a year ago.  The MoM change was slightly better than February, which is to be expected given the seasonal pattern - home prices are generally stronger in the spring (March through June).

13 of the 20 cities hit new lows in March.  Home prices have been strongest in the highest-value markets, particularly D.C., New York, and Los Angeles.  

We've noted for several months an increasing divergence between the Corelogic HPI and the Case-Shiller HPI.  These series are not identical in scope and methodology, but the differences between them don't immediately explain the growing gap.  

CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP - all 3 yoy

CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP - all 3 mom

Based on our demand model, we expect 18% downside in home prices in 2011 versus 2010.

CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP - scatter

The charts below show the MoM and YoY change in Case-Shiller by city on an NSA basis.  18 of the 20 cities (all except D.C. and Seattle) moved lower MoM.  Looking at the YoY, D.C. was the only gainer.  

CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP - mom by city

CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP - yoy by city

We show below that the higher-priced cities are also seeing better performance MoM and YoY. 

CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP - mom scatter

CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP - yoy scatter

The chart below shows the Case-Shiller 20-city NSA index with YoY and MoM changes. 

CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP - nsa

CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP - c s yoy

As noted, home prices have a seasonal component, showing stronger performance in April, May, and June.

CASE-SHILLER MARCH HOME PRICES OFFICIALLY DOUBLE-DIP - c s mom

Joshua Steiner, CFA

Allison Kaptur