S&P Corelogic Case-Shiller HPI

Highlights. Case-Shiller home prices continue to move gradually higher, up 0.5 percent for August’s 20-city adjusted index. The year-on-year rate of 5.9 percent is a 3-year high. The report shows broad-based strength: San Diego up 1.0 percent in the month, Charlotte and Las Vegas both up 0.9 percent, and Cleveland up 0.8 percent.

Seattle is far out in front on a yearly basis, up 13.3 percent with most of the 20 cities in the mid-to-high single digits and with Washington DC in the rear at 3.4 percent.

The FHFA house price index has been showing a bit more strength than Case-Shiller but it’s the trends of the two reports that’s important, and that is climbing. Home price appreciation is an increasingly important source of household wealth in what has been a low interest rate, low wage growth economy.

Market Consensus Before Announcement

Case-Shiller home prices moved higher in July and more of the same, following strength in the prior week’s FHFA house price index, is expected for September. Econoday’s consensus is calling for a 0.5 percent gain in the 20-city adjusted index on top of July’s 0.7 percent rise. August is a busy month for home sales and is reflected in the consensus for the unadjusted monthly index which is slightly higher, at 0.6 percent gain. The year-on-year rate is seen up 2 tenths to 6.0 percent.


The S&P Corelogic Case-Shiller home price index tracks monthly changes in the value of residential real estate in 20 metropolitan regions across the U.S. Composite indexes and regional indexes measure changes in existing home prices and are based on single-family home re-sales. The expanded 20-city measure is the key series. The original series (still available) covered 10 cities. A national index is published quarterly. The indexes are based on single-family dwellings with two or more sales transactions.

Condominiums and co-ops are excluded as is new construction. The Case-Shiller Home Price Indices are published monthly on the last Tuesday of each month at 9:00 AM ET. The latest data are reported with a two-month lag. For example data released in January are for November. Note that S&P, citing large seasonal swings in the housing sector and the risk of adjustment inaccuracies, urges readers to track unadjusted data in this report.


Home values affect much in the economy – especially the housing and consumer sectors. Periods of rising home values encourage new construction while periods of soft home prices can damp housing starts. Changes in home values play key roles in consumer spending and in consumer financial health. During the first half of this decade sharply rising home prices boosted how much home equity households held. In turn, this increased consumers’ ability to spend, based on wealth effects and from being able to draw upon expanding home equity lines of credit.

With the onset of the credit crunch in mid-2007, weakness in home prices had the reverse impact on the economy. New housing construction has been impaired and consumers have not been able to draw on home equity lines of credit as in prior years. But an additional problem for consumers is that a decline in home values reduces the ability of a home owner to refinance.

During the recent recession, this became a major problem for subprime mortgage borrowers as adjustable rate mortgages reached the end of the low “teaser rate” phase and ratcheted upward. Many subprime borrowers had bet on higher home values to lead to refinancing into an affordable fixed rate mortgage but with home equity values down, some lenders balked at refinancing subprime borrowers. But even though the economy technically moved into recovery, unemployment has remained high and depressed home prices have affected an increasing number of households.

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