Home Prices Continue to Decline in 11 of the 20 Major Metro Areas

Data through November 2008, released last week by Standard & Poor's for its S&P/Case-Shiller Home Price Indices, shows continued broad based declines in the prices of existing single family homes across the United States, with 11 of the 20 metro areas showing record rates of annual decline, and 14 reporting declines in excess of 10 percent compared to November 2007.

Of the 20 cities tracked, Detroit alone has lower home prices now than in 2000. Its index was 83.42. The indices have a base value of 100 in January 2000; thus, for example, a current index value of 150 translates to a 50 percent appreciation rate since January 2000 for a typical home located within the subject market.

In addition, eight of the Metropolitan Statistical Areas (MSAs) posted their largest monthly decline on record – Atlanta, Boston, Charlotte, Chicago, Dallas, New York, Portland and Seattle. Although in decline over the past few years, some of these regions have out-performed on a relative basis, when compared to the national average.

New York City, with an index of 186.81, led the index for long-term growth in home values. However, the nation's financial capital recorded a November monthly decline of 1 percent and an annual decline of 8.6 percent. It is clear that the decline in home prices is affecting all regions regardless of geography or employment opportunities.

Dallas and Denver faired the best in November, in terms of relative year-over-year returns. While in negative territory, their declines remained in low single digits of -3.3 percent and -4.3 percent, respectively. It should be noted, Charlotte reported its third consecutive largest monthly decline on record, down 1.9 percent.

On a relatively positive note, eight of the 20 metro areas recorded better annual returns compared to last month.

November 2008 S&P/Case-Shiller Home Prices Indices

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