According to the July 2010 S&P/Case-Shiller Home Price Index, single-family home prices in the San Francisco MSA rose 0.5% from June ’10 to July ’10, down 34.4% from a peak in May 2006 and up 11.2% year-over-year (YOY) versus a 14.3% YOY gain reported in June.
For the broader 10-City composite (CSXR), home values rose 0.8% from June to July for a fourth straight monthly gain but remain down 28.3% from a peak in June 2006 as the year-over-year gain slipped to 4.1%.
The year-over-year growth rates for 16 of the cities and both Composites weakened in July compared to June. While we could still see some residual support from the homebuyers’ tax credit, which covers purchases closing through September 30th, anyone looking for home price to return to the lofty 2005-2006 might be disappointed. Judging from the recent behavior of the housing market, stable prices seem more likely.
In the monthly data, 12 of the 20 MSAs and the two Composites were up in July over June; but the monthly rates also seem to be weakening. The next few months may give us an idea of the true strength of the housing market, as the temporary economic stimuli will have ended. Housing starts, sales and inventory data reported for August do not show signs of a robust market, and foreclosures continue.
Prices were up across the bottom two price tiers on a month-over-month basis but declined for the top third of San Francisco MSA single-family homes for the second month in a row.
The bottom third (under $342,906 at the time of acquisition) gained 2.2% from June to July (up 15.1% YOY); the middle third gained 1.2% from June to July (up 9.6% YOY); and the top third (over $621,684 at the time of acquisition) fell 0.4% from June to July (up 2.8% YOY versus 5.1% in June).
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA returned to October 2000 levels having fallen 55% from a peak in August 2006, the middle third is back to just below May 2003 levels having fallen 34% from a peak in May 2006, and the top third is back to just below April 2004 levels having fallen 22% from a peak in August 2007.
Condo values in the San Francisco MSA rose 1.7% from June ’10 to July ’10, falling to a 2.2% gain on a year-over-year basis (down 25.9% 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).
∙ Home Prices Remain Stable Around Recent Lows [Standard & Poor's]
∙ June Case-Shiller: San Francisco MSA Tips Atop As YOY Gains Retreat [SocketSite]