In recent months, we've noticed favorable market factors
at the lower end of the price/size range
for homes for sale in
Eugene, Springfield and Lane County, OR.
We've read about declining inventories and stabilizing home prices in many parts of the country --
as evidenced by information posted on
the Active Rain real estate network.
The first reliable, positive national numbers appeared a month ago when
the Case-Shiller Index
(as reported by Standard and Poors and the Wall Street Journal)
for May showed that Index's first month-on-month increases in nearly three years.
Now, for the Index for the month of
June, 2009
is even more positive.
What is the Case-Shiller Index?
This monthly report is derived from year-on-year sale of the same homes.
It's not an arithmetic mean (average). It's not a statistical median (half above/half below).
It compares prices paid for individual homes that have turned over during the reporting period.
It is the most accurate market statistic for prices of homes for sale in the United States.
For every city scored by Case-Shiller, a score of 100 represents the level of home prices in the year 2000.
Unfortunately, the Case-Shiller Index is compiled for only 20 American metropolitan areas as shown on the chart below.
The cities have been ranked in descending order
by the percentage change in price
during the twelve months ending in June, 2009.
In June, only two cities among the Case-Shiller twenty failed to see an increase in prices:
Detroit and Las Vegas.
Cities going from no change in May to an increase in June included:
New York and Tampa.
Cities changing from a decline in home prices during May to an increase in June were:
Seattle, Los Angeles, and Miami.
None of the listed cities shows a positive number
for the twelve-month period.
The uptick in May and June means that
the market is beginning to
take back
a fraction of the loss in value experienced by U.S. homes for sale
during the last year.
The Case-Shiller city located closest to the Eugene, Springfield and Lane County market is
Portland, OR.
Portland's Index score reached it's highest point in July, 2007.
That month the Portland score was 186.51 -- meaning prices in that metro area were
86.51 % higher
than in January, 2000.
In June, Portland stood at 148.47 -- a decline in home values
of 20.3% from that July, 2007 high.
Case-Shiller Index - June, 2009
Case-Shiller Index
City |
Index Value
June, 2009
|
Change From
May, 2009
|
Change for year ending in
June, 2009
|
Dallas
|
119.68
|
+ 2.7%
|
- 2.2%
|
Cleveland
|
106.38
|
+ 4.2%
|
- 3.0%
|
Denver
|
126.92
|
+ 2.5%
|
- 3.6%
|
Boston
|
152.71
|
+ 2.6%
|
- 5.9%
|
Charlotte
|
120.66
|
+ .7%
|
- 9.6%
|
Washington
|
174.32
|
+ 2.8%
|
- 11.8%
|
New York
|
171.49
|
+ .4% |
- 11.9%
|
Atlanta
|
107.52
|
+ 1.5%
|
- 13.7%
|
Portland, OR
|
148.47
|
+ 1.0%
|
-15.2%
|
San Diego
|
147.31
|
+ 1.6%
|
- 16.0%
|
Seattle
|
149.53
|
+ 0.4%
|
-16.1%
|
Chicago
|
124.99
|
+ 1.1%
|
- 16.7%
|
Los Angeles
|
160.90
|
+ 1.1%
|
- 17.8%
|
Tampa
|
140.90
|
+ 0.4%
|
- 19.5%
|
Minneapolis
|
113.46
|
+ 3.1%
|
- 19.8%
|
San Francisco
|
124.70
|
+ 3.8%
|
- 22.0%
|
Miami
|
145.37
|
+ 0.5%
|
- 23.4%
|
Detroit
|
69.49
|
- 0.8%
|
- 25.0%
|
Phoenix
|
104.73
|
+ 1.1%
|
- 31.6%
|
Las Vegas
|
107.31
|
- 2.0%
|
- 32.4%
|
For the sake of comparison, the Case- Shiller data
for
May, 2009
is repeated below:
Case-Shiller Index
City |
Index Value
May, 2009
|
Change From
April, 2009
|
Change for year ending in
May, 2009
|
Dallas
|
116.54
|
+ 1.9%
|
- 4.1%
|
Denver
|
123.78
|
+ 1.3%
|
- 4.6%
|
Cleveland
|
102.11
|
+ 4.1
|
- 6.2%
|
Boston
|
148.77
|
+ 1.6%
|
- 7.2%
|
Charlotte
|
119.80
|
+ .9%
|
-10%
|
New York
|
170.51
|
0%
|
-12.2%
|
Washington
|
169.49
|
+ 1.3%
|
-14.9%
|
Atlanta
|
105.69
|
+ .3%
|
-15.0%
|
Portland, OR
|
146.97
|
+ .1%
|
-16.3%
|
Seattle
|
148.96
|
- 0.3%
|
-16.6%
|
Chicago
|
123.68
|
+ 1.1%
|
-17.5%
|
San Diego
|
145.06
|
+ 0.4%
|
-18.5%
|
Los Angeles
|
159.18
|
- 0.1%
|
-19.8%
|
Tampa
|
140.35
|
0.0%
|
-20.8%
|
Minneapolis
|
109.77
|
+ 1.2%
|
-21.7%
|
Detroit
|
70.05
|
+ 0.2%
|
-24.5%
|
Miami
|
144.59
|
- 0.8%
|
-25.2%
|
San Francisco
|
120.16
|
+ 1.4%
|
-26.1%
|
Las Vegas
|
109.49
|
- 2.6%
|
-32.0%
|
Phoenix
|
103.56
|
- 0.9%
|
-34.2%
|
It would be great if we had Case-Shiller data for our own local market.
Eugene is not Portland.
Our housing values are different.
Our local economy does not precisely track Portland.
Our unemployment rate is higher.
Our employer mix is much different.
Nevertheless, Portland is an important driver for what happens to home prices here. The upturn in Portland is truly good news. That it appears part of a national trend in prices for homes for sale is quite heartening.
What's the significance of Portland's 15.2% decrease in home value during the last year?
Here's the impact of a 15.2% decline in the price for several levels of home value one year ago:
Value In
June
2008
|
15.2%
Decrease
|
Value In
June
2009
|
$1,000,000
|
$152,000
|
$848,000
|
$500,000
|
$76,000 |
$464,000
|
$400,000
|
$60,800
|
$339,200
|
$300,000
|
$45,600
|
$254,400
|
$200,000
|
$30,400
|
$169,600
|
$100,000
|
$15,200
|
$84,800 |
