According to the June 2010 S&P/Case-Shiller Home Price Index, single-family home prices in the San Francisco MSA rose a nominal 0.3% from May ’10 to June ’10, down 34.7% from a peak in May 2006 but up 14.3% year-over-year (YOY) versus an 18.3% YOY gain reported in May.
For the broader 10-City composite (CSXR), home values rose 1.0% from May to June for a third straight monthly gain but remain down 28.8% from a peak in June 2006 (up 5.0% year-over-year).
“The monthly Composites cover June and the national index covers the second quarter, when the government’s program for first time home-buyers was winding down. While the numbers are upbeat, other more recent data on home sales and mortgages point to fewer gains ahead,” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “Even with concerns about near term developments, we recognize that the housing market is in better shape than this time last year. Further, California’s cities have moved from some of the hardest hit to three of the four leading cities based on year-over-year gains. Among the other hard hit cities, the news is also a bit encouraging – Las Vegas, however, remains among the weaker cities.
“Seventeen of the 20 MSAs and both Composites saw home prices increase in June over May – Las Vegas was down 0.6%, Phoenix and Seattle were both flat. Through the second quarter, 15 of the 20 MSAs and both Composites have positive annual growth rates, and no market is registering a doubledigit decline. The worry starts when you remember that the Homebuyers’ Tax Credit has expired, foreclosures are still at high levels, and July data on home sales and starts were very, very weak. The inventory of unsold homes and months’ supply data were particularly troubling. If this relative weakness in demand continues, it will likely filter through to home prices in coming months.”
On a month-over-month basis prices were relatively flat across the market tiers with nominal gains at the bottom and nominal declines at the top for single-family homes in the San Francisco MSA.
The bottom third (under $337,624 at the time of acquisition) gained 0.8% from May to June (up 14.7% YOY); the middle third was unchanged from May to June (up 9.7% YOY); and the top third (over $613,353 at the time of acquisition) fell 0.6% from May to June (up 5.1% YOY versus 8.3% in May).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA remain just above September 2000 levels having fallen 56% from a peak in August 2006, the middle third is back to just below April 2003 levels having fallen 34% from a peak in May 2006, and the top third is back to April 2004 levels having fallen 22% from a peak in August 2007.
Condo values in the San Francisco MSA rose 0.7% from May ’10 to June ’10, falling to a 2.5% gain on a year-over-year basis (down 27.2% from an December 2005 high).
Our standard SocketSite S&P/Case-Shiller footnote: The S&P/Case-Shiller home price indices include San Francisco, San Mateo, Marin, Contra Costa, and Alameda in the “San Francisco” index (i.e., greater MSA) and are imperfect in factoring out changes in property values due to improvements versus appreciation (although they try their best).
∙ Second Quarter of 2010 Saw Modest Improvement in Home Prices [Standard & Poor's]
∙ May Case-Shiller: San Francisco Tiers Up But Gains Moderating Atop [SocketSite]
∙ Existing U.S. Home Sales Pace Plunges 27.2% In July (25.5% YOY) [SocketSite]