Wednesday, February 24, 2010

Case Shiller Mixed

Yesterday, Standard and Poor's released the Case Shiller home price index. In contains good and bad news.

On the good side, while the pace of year over year declines is still negative the rate of year over year decline continues to improve.

However, on a month to month basis we're seeing price appreciation stall, as evidenced by

the fact a majority of cities have seen a decline over the last two months.

So -- what does this mean? Starting in November there was confusion in the market about the new home buyer tax credit program. As it was set to expire, we saw a big drop in existing home sales on a seasonally adjusted basis. Weaker demand = lower prices. We'll have to see how all of this plays out over the next few months.