S&P/Case-Shiller Indices ‘Plummet,’ Enter Negative Territory

January data released today by Standard & Poor’s for its S&P/Case-Shiller Home Price Indices, the leading measure of U.S. home prices in the United States, shows home price composites plummeting into negative terrain. S&P said that annual returns of the composite indices shows the 10-City Composite and the 20-City Composite down 0.7 percent and down 0.2 percent, respectively, from January of 2006. “The annual declines in the composites are a good indicator of the dire state of the U.S. residential real estate market,â€? says Robert J. Shiller, chief economist at MacroMarkets LLC. “The 10-City and 20-city Composites are both showing negative annual returns, a striking difference from the 15.1% and 14.7% returns they reported this time last year. The dismal growth in the 10-City composite is now at rates not seen since January 1994.â€?

The decline in the returns of the composites is led by Detroit and Boston, starting their year with annual declines of 6.9% and 5.6%, respectively.


Seattle and Portland – having shown some resistance to the sharp downward trend – have reported their second consecutive flat or negative monthly returns. With Phoenix and Tampa now reporting negative annual returns, 11 of the 20 metro areas are now in year-over-year decline. Interestingly, Charlotte rebounded in January to 7.9 percent compared to the 6.7 percent reported in December. Charlotte is the only metro area that showed price increases between December and January. For more information, visit http://www.standardandpoors.com.

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