Last year, we took a Closer Look at the Second Leg Down in Housing.

Today, the S&P Case Shiller NSA 20 checked in at 139.27; the previous post-bubble low is 139.26.

Here’s the release:

“Data through February 2011, released today by S&P Indices for its S&P/Case-Shiller1 Home Price Indices, the leading measure of U.S. home prices, show prices for the 10- and 20-city composites are lower than a year ago but still slightly above their April 2009 bottom. The 10-City Composite fell 2.6% and the 20-City Composite was down 3.3% from February 2010 levels. Washington D.C. was the only market to post a year-over-year gain with an annual growth rate of +2.7%. Ten of the 11 cities that made new lows in January 2011 saw new lows again in February 2011. With an index level of 139.27, the 20-City Composite is virtually back to its April 2009 trough value (139.26); the 10-City Composite is 1.5% above its low.”

Case Shiller charts:

click for larger graphs

Category: Data Analysis, Real Estate

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

25 Responses to “Case Shiller Double Dip Almost Here”

  1. dcsos says:

    How is it possible that you see 3% drop in house prices from Case Shiller, but Marketwatch calls it 1.1%?

  2. Ted Kavadas says:

    From all that I have seen, there seems to be an inherent expectation that real estate is either “bottoming” or within 5-10% of doing so.

    The MacroMarkets Home Price Expectations survey shows a consensus expectation of a type of “rounding bottom” in real estate prices. We shall see if this expectation is accurate soon enough – I for one believe that it is too optimistic. For those interested I summarized the March survey here:

  3. RandyClayton says:

    Does decline — slight pause — continued decline define double-dip? I believe in the canonical double-dip recession of 1980 the brief growth period between the two recessionary periods returned GDP to a level close to the peak GDP level.

    I do worry that the long term inflation adjusted CS trend line of 100 is a long, long way away and provides a gravitational pull that will win in the long term.

  4. Guillermo says:

    more than the overall price level, I think the story is in dispersion, where smaller homes and non-lux condos will bottom, stabilize and maybe even rise while big-ass McMansions overshoot a little more.

    The reason I think so is the cost of carry of a home. Big homes have big cost of carry and new home-buyers are going to want to optimize how much house they need, instead of maximize how much space they get. Homes are expensive to heat-up, cool, clean, paint, up-keep, pay taxes on etc. Why pay the carry on a 4k sq foot ‘burb house when you only really need a 1200sq ft condo?

    Looking at homes in the burbs where I am (South, FL) it’s obvious that many of the homes are just way too big. Thousands and thosands of square feet with humongous ceilings. 3-5 beds + study and 3.5-5 baths. Master suites that are bigger than any apartment I’ve ever lived in, huge living/family/dining rooms. A/C gets pricey down here (as heat does up north) and the weather takes a toll on homes. They need frequent paint and landscaping and roof power-washing and roofing fixes and stucco repairs and pest-control.

    Not to mention it’s a pain in the ass to fill all these houses with stuff, especially in a time where more and more of the stuff that used to fill our shelves (pictures, photo albums, CDs, movies, books) are digital. My first glimpse into this digital nomad-ism came last time I moved. My entire life fit in a rented suburban truck, including some furniture. My 800sq ft 2br apartment feels GIGANTIC. the 5k sq ft house is dead and prices will reflect that.

  5. wally says:

    Isn’t it amazing how problems that don’t get fixed persist? What a surprise!

    The picture here in Minneapolis is not a double-dip, but is a steady decline that is still underway. I suspect that different regions will have different profiles; Case-Schiller is bundling that into a national picture and your mileage may differ.

  6. ashpelham2 says:

    Still having a hard time figuring out where my local market fits in. As usual, Birmingham, Alabama isn’t included in a national survey of cities (unless it’s related to crime or obesity. USA! USA!) So, my local market I would think would be similar to what Atlanta has experienced, since it’s so geographically close. But the two cities are more different than they are alike. And, my local market, like probably others, is broken down by zip codes. The more “toney” your burb is, the less likely there has been significant depreciation. The more crappy the area you live in is, the more likely you’re house can be found in Detroit.

  7. me says:

    I recently saw a chart of income to housing price that I am sorry I cannot find right off; but, we are not even close to a bottom.


    BR: I believe you are talking about the chart posted Monday here

  8. louis says:

    I speak tonight for the dignity of man and the desony of democracy.I urge every member of both parties, Americans of all religions and of all colors, from every section of this country, to join me in that cause. At times history and fate meet at a single time in a single place to shape a turning point in man’s unending search for freedom. So it was at Lexington and Concord. So it was a century ago at Appomattox.
    There is no cause for pride in what has happened in American Mortgage markets. There is no cause for self-satisfaction in the long denial of equal rights of millions of Homeowers.
    Our mission is at once the oldest and the most basic of this country: to right wrong, to do justice, to serve man.

    There is only an American housing and employement problem. And we are met here tonight as Americans–not as Democrats or Republicans — we are met here as Americans to solve that problem.

  9. tradeking13 says:

    Time for another home buyer tax-credit.

  10. BennyProfane says:

    As always, I’m just stunned that Florida, Arizona, and Vegas haven’t shown any sign of bouncing back from the depths. Where are the retiring Boomers? They should be snapping up these bargains like courses at an early bird special buffet. You can nail a nice little thing in a great area in South Florida for around 100 grand. Maybe a pool and dock out back. WTF? Are they that poor and indebted?

  11. socaljoe says:

    Let’s not forget a dollar is worth less today than it was a year ago… in real terms Case-Shiller has dipped to a new post-crash low.

    Any seller who refuses to lower his price to market levels is bleeding at least 5%/yr of real wealth.


    BR: Are you arguing that Home prices bought and sold in dollars by workers who get paid in dollars are impacted by dollar fluctuations?

  12. AG Sage says:

    Double dip, government-intervention-delayed plummet, same difference.

  13. me says:

    “Where are the retiring Boomers?”

    Stuck in a house they can’t sell at any price and a 201K instead of a pension.

  14. KJ Foehr says:

    BennyProfane Says:

    “Where are the retiring Boomers?”

    Still working; can’t or won’t retire.

    “They should be snapping up these bargains like courses at an early bird special buffet. You can nail a nice little thing in a great area in South Florida for around 100 grand. Maybe a pool and dock out back.”

    That’s just human nature. There is a saying about this that I can’t recall exactly, but it’s something like this: people always want to invest more when prices are high and the least when they are low.

    When you think about it, it must be this way: more demand, higher prices; less demand, lower prices.

    We saw it in RE before, and we see it in oil and precious metals now.

    What in human nature makes people this way? Greed at the top and fear at the botom, imo.

  15. red eye repub says:

    Hey Barry,

    Are you trying to tell us that Big Government policies don’t work?

    TARP, TALF, HAMP….how many government programs will we waste our taxpayer funds before Obama and the other Central Planners realize Keynesian policies are only leading us into ruin?


    BR: Those policies were designed to rescue banks, not housing. TARP & TALF by definition, and HAMP indirectly

    These are the facts — those are annoying things that idealogues such as yourself are unfamiliar with.


  16. [...] Home prices are likely to make new lows.  (Calculated Risk, Big Picture) [...]

  17. BennyProfane says:

    Yeah, but, it’s just so much cheaper down there. No heat, minimal clothes, no state tax, no winter able monster SUV needed, early bird specials, and incredibly cheap housing these days. How about the substantial number of Boomers who are well above the water line because hey bought in the 80s or 90s and are paid off? You would think some of them would be cashing in and moving south. This is not a very good sign for the next decade or two. We are going to have a lot of old Boomers stuck in MacMansions eating pet food and wondering how they’re going to pay the ever increasing property tax.

  18. wally says:

    “As always, I’m just stunned that Florida, Arizona, and Vegas haven’t shown any sign of bouncing back from the depths. Where are the retiring Boomers?”

    Don’t assume that the Boomers will do the same thing in retirement that their parent’s generation did. I, for one, have absolutely no desire to move to the places you listed.

  19. BennyProfane says:

    Me neither, but, I don’t eat fast food crap and watch American Idol.

  20. baldski says:

    I follow Reggie Middleton on Zero Hedge and so far he has been right on his calls. He says the current shadow inventory in real estate will take 5+ years to get rid of at the present rate of selling. So, I’m waiting until 2016 for a bottom to buy a house.

  21. Frwip says:

    BennyProfane Says :

    ” How about the substantial number of Boomers who are well above the water line because hey bought in the 80s or 90s and are paid off? You would think some of them would be cashing in and moving south. ”

    The Boomers in question aren’t paid off anymore. Home equity loans made sure of that, with a big not-so-shinny-anymore SUV in the driveway, 2005-vintage giant plasmas screen in the main room and long-forgotten “dream vacations” in the Caribbeans.

  22. DeDude says:

    Red eye repub;

    They worked fantastically. If you were to continue that falling curve from before those programs we would be at about 100 now. We would also be in great depression II and huge numbers of regular people would have lost their jobs, houses and retirement funds. By postponing the fall huge amounts of wealth was saved – way more than the cost of those programs. That is the beauty of Keynesian policies, they work and always have worked.

  23. red eye repub says:


    Respectfully, I disagree. The key word is ‘postpone’. The fact is that adjustable rate mortgages with nothing down are gone. Interest rates are rising. How do prices not keep falling? And we’re to expect that the same institutions who are already holding so much poisonous paper that the gov was ‘forced’ to bail them out are going to lend freely in a declining market?


    HAMP was specifically created to ‘save housing’. As was HASP, which literally stands for Homeowners Affordability And Stabilization Program. Clearly I am an ideologue, but that doesn’t mean I’m not objective. Bush presded over the first bailouts and it was a terrible mistake. All I’m asking is for a little intellectual honesty. The double dip is coming, and our government wasted billions if not trillions of dollars trying to stop it like a bug that tries to stop a car on the highway.

    *Sent from my politically liberal iPhone.


    BR: The TARP and TALF were completely and totally bank rescues. This is not debatable.

    HAMP was sold as a housing rescue, but I have been arguing that it — and the Fannie/Freddie rescues — were in reality backdoor bailouts for the banks.

  24. louis says:

    Red Eye what Barry is saying is all right here.

    This guy was alot closer than most and clearly thinks they were backdoor bailouts also. Why anyone really needs convincing of that is beyond me. The whole thing is a funding program for banks. Numbers do not lie on how much bigger they are now.

  25. DeDude says:

    Postponing is indeed the key and strength of Keynesian policies. By postponing a credit crisis my employer gets time to restructure and pay down debt. He postpones lay-offs so I get time to restructure and prepare my own financial situation and maybe even sell my house rather than have it auctioned in foreclosure. The damage can be mitigated and reduced if you buy time to prepare for it. Only the rich vultures win in a collapse. Another 10 million unemployed people for a year is equal to about 1 trillion in lost GDP (the productivity they would have had if employed rather than doing nothing). That trillion is lost forever, they cannot make it back up when they later get a new job. That is the price (of doing nothing) that you have to compare with when you complain about the cost of interventions. Another thing is how you intervene and there I have a lot of problems with the way things were done. You should save the banks not the banksters. You always do all public infrastructure investment when you head into a severe recession and wait with the tax-cuts until the private sector lay-offs have turned and guarded optimism can be feed with more spending money in the pockets of consumers.