According to the September 2012 S&P/Case-Shiller Home Price Index, single-family home prices in the San Francisco MSA rose 0.5% from August to September and are up 7.5% year-over-year but remain down 34.4% from a May 2006 peak.
For the broader 10-City composite (CSXR), home values rose 0.2% from August to September and are up 2.1% year-over-year, down 29.8% from a June 2006 peak.
We are entering the seasonally weak part of the year. The headline figures, which are not seasonally adjusted, showed five cities with lower prices in September versus only one in August; in the seasonally adjusted data the pattern was reversed: one city fell in September versus two in August. Despite the seasons, housing continues to improve.
Phoenix continues to lead the recovery with a +20.4% annual growth rate. Atlanta has finally reversed 26 months of annual declines with a +0.1% annual rate as observed in September’s housing data. At the other end of the spectrum, Chicago and New York were the only two cities to post annual declines of 1.5% and 2.3% respectively and were also down 0.6% and 0.1% month-over-month.
Thirteen of the 20 cities recorded positive monthly returns; Boston, Charlotte, Chicago, Cleveland and New York saw modest drops in home prices in September as compared to August; Tampa and Washington D.C. were flat. With six months of consistently rising home prices, it is safe to say that we are now in the midst of a recovery in the housing market.
On a month-over-month basis, prices rose across the bottom two San Francisco price tiers with a nominal drop at the top.
The bottom third (under $366,247 at the time of acquisition) rose 2.0% from August to September, up 12.2% year-over-year; the middle third rose 1.7% from August to September, up 10.4% YOY; and the top third (over $666,869 at the time of acquisition) slipped 0.1% from August to September, up 5.6% YOY versus 4.7% in August.
According to the Index, single-family home values for the bottom third of the market in the San Francisco MSA have returned to November 2000 levels (55% below an August 2006 peak), the middle third has returned to February 2003 levels (35% below a May 2006 peak), and the top third remains at May 2004 levels (21% below an August 2007 peak).
Condo values in the San Francisco MSA gained 0.9% from August to September and are up 13.5% year-over-year but remain 25.0% below their December 2005 peak.
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).
∙ S&P/Case-Shiller: Home Prices Rise for the Sixth Straight Month [Standard & Poor's]
∙ San Francisco Home Values Tick Up, Condos Up 11.1 Percent YOY [SocketSite]