Data through December 2012, released by S&P Dow Jones Indices for its S&P/Case-Shiller Home Price Indices, showed that all three headline composites ended the year with strong gains. The national composite posted an increase of 7.3 percent for 2012. Month over-month, both the 10- and 20-City Composites moved into positive territory with gains of 0.2 percent; more than reversing last month’s losses. In addition to the three composites, 19 of the 20 MSAs posted positive year-over-year growth—only New York fell.
“Home prices ended 2012 with solid gains,” said David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices. “Housing and residential construction led the economy in the 2012 fourth quarter. In December’s report all three headline composites and 19 of the 20 cities gained over their levels of a year ago. Month-over-month, nine cities and both Composites posted positive monthly gains. Seasonally adjusted, there were no monthly declines across all 20 cities."
The chart below depicts the annual returns of the U.S. National, the 10-City Composite and the 20-City Composite Home Price Indices. The S&P/Case-Shiller U.S. National Home Price Index, which covers all nine U.S. census divisions, recorded a 7.3 percent gain in Q4 of 2012 over the fourth quarter of 2011. In December 2012, the 10- and 20-City Composites posted annual increases of 5.9 percent and 6.8 percent, respectively.
“The National Composite increased 7.3 percent over the four quarters of 2012," said Blitzer. "From its low in the first quarter, it surged in the second and third quarter and slipped slightly in the 2012 fourth period. The 10- and 20-City Composites, which bottomed out in March 2012 continued to show both year-over-year and monthly gains in December. These movements, combined with other housing data, suggest that while housing is on the upswing some of the strongest numbers may have already been seen."
The chart below shows the index levels for the U.S. National Home Price Index, as well as its annual returns. As of Q4 of 2012, average home prices across the United States are back at their autumn 2003 levels. At the end of the fourth quarter of 2012, the National Index was down 0.3 percent over the third quarter of 2012 and 7.3 percent above the fourth quarter of 2011.
The chart above shows the index levels for the 10-City and 20-City Composite Indices. As of December 2012, average home prices across the U.S. for the 10-City and 20-City Composites are back to their autumn 2003 levels. Measured from their June/July 2006 peaks, the decline for both Composites is approximately 30 percent through December 2012. For both Composites, the December 2012 levels are approximately eight percent through nine percent above their recent lows seen in March 2012.
In December 2012, nine MSAs and both Composites posted positive monthly gains, led by Las Vegas with an increase of 1.8 percent. Eleven cities declined with Chicago posting the largest negative monthly return of 0.7 percent. Atlanta and Detroit remain the only three cities with average home prices below their January 2000 levels. Detroit with an 80.04 print is 20 percent below its January 2000 level.
