April’s data for the S&P/Case-Shiller Home Price Indices were broadly positive when you look at the monthly data. The 10- and 20-City Composites were up 0.8% and 0.7%, respectively. In addition, 13 of the 20 MSAs covered by the indices were up in April over March.
That said, a closer look at the annual rates of change (which removes any seasonal effect on price changes) shows a grimmer picture for the housing market.
In April, only four of the MSAs saw improvement in their annual rates of change versus what they posted in March. This means that home prices versus the same month last year were even lower than previously reported. And for three of these markets – Miami, New York and Seattle – the rates of change are only slightly less negative, but still negative. Washington DC is the only market that posted a positive annual growth rate in April.
Over the next six months or so, we expect market participants to focus on the monthly and annual changes, trying to separate anticipated seasonal movements from the true momentum of the housing market.