Residential property prices in 20 major US cities fell in 2010 according to date released by Standard & Poor’s with only Dan Diego and Washington DC seeing a year on year increase.
The S&P/Case-Shiller Home Price Indices regarded as the leading measure of US home prices, show that the US National Home Price Index declined by 3.9% during the fourth quarter of 2010.
The National Index is down 4.1% versus the fourth quarter of 2009, which is the lowest annual growth rate since the third quarter of 2009, when prices were falling at an 8.6% annual rate.
As of December 2010, 18 of the 20 metropolitan statistical areas (MSAs) covered by S&P were down compared to December 2009. Both Los Angeles and San Francisco reported negative annual rates of return in December, leaving San Diego and Washington DC as the only two cities where home prices are increasing on a year on year basis, up 1.7% and 4.1%, respectively.
The S&P/Case-Shiller U.S. National Home Price Index, which covers all nine US census divisions, recorded a 4.1% decline in the fourth quarter of 2010 over the fourth quarter of 2009. In December, the 10 and 20 City Composites posted annual rates of decline of 1.2% and 2.4%, respectively. Thirteen of the 20 MSAs and both monthly Composites saw their annual growth rates fall in December versus November.
‘We ended 2010 with a weak report. The National Index is down 4.1% from the fourth quarter of 2009 and 18 of 20 cities are down over the last 12 months. Both monthly Composites and the National Index are moving closer to their 2009 troughs. The National Index is within a percentage point of the low it set in the first quarter of 2009. Despite improvements in the overall economy, housing continues to drift lower and weaker,’ said David Blitzer, chairman of the Index Committee at Standard & Poor’s.
‘Unlike the 2006 to 2009 period when all cities saw prices move together, we see some differing stories around the country. California is doing better with gains from their low points in Los Angeles, San Diego and San Francisco. At the other end is the Sun Belt that is Las Vegas, Miami, Phoenix and Tampa. All four made new lows in December,’ he explained.
‘Also seeing renewed weakness are some cities that were among the last to reach their peaks including Atlanta, Charlotte, Portland, Oregon, and Seattle, where news lows were also seen. Dallas, which peaked late, has so far stayed above its low marked in February 2009.
The 10 and 20 City Composite indices remain above their spring 2009 lows. However, 11 markets, Atlanta, Charlotte, Chicago, Detroit, Las Vegas, Miami, New York, Phoenix, Portland (Oregon), Seattle and Tampa hit their lowest levels since home prices peaked in 2006 and 2007.
Looking deeper into the monthly data, 19 MSAs and both Composites were down in December over November. The only one which was not in the list is Washington DC, up 0.3%. With December 2010 index levels of 99.73 and 99.48, respectively, Cleveland and Las Vegas have the dubious distinction of average home prices now below their January 2000 levels. Detroit was the only market that was in that group prior to December”.
As of the fourth quarter of 2010, average home prices across the United States are at similar levels to what they were in the first quarter of 2003.
Six cities showed an improvement in their annual growth rates in December as compared to November 2010, Charlotte, Chicago, Cleveland, Dallas, Denver and Washington DC. However, for five of these cities the improvement only means the annual rates are less negative than what was reported in November.
Eleven MSAs posted new index level lows in December 2010, since their 2006/2007 peaks. These cities are Atlanta, Charlotte, Chicago, Detroit, Las Vegas, Miami, New York, Phoenix, Portland, Seattle and Tampa.