Home Price MonitorOctober 2011

National Association of REALTORS®Research DivisionCutting Through the Noise: Various Home Price Measure

Highlights• While month to month home prices in August were roughly

stable, the end of the summer selling season led to a typical seasonal decline in September among currently available price measures. This seasonal decline generally continues through February.

• Compared to one year ago, however, price change was stable from August to September among existing homes—available data show a 3-4 percent year to year decline in both months—while price change worsened somewhat among new homes.

• Previously, new homes had shown better price performance over the year; August began the sharp reversal of this trend which continued in September. Low levels of new construction and very little activity in the new home sector may be causing substantial volatility in the data. Additionally, the structure of the first-time home buyer tax credit which had conditions on both the contract and closing dates likely led to lingering effects on the new home market. Expect better year over year price change among new homes in October.

Outlook• Distressed sales, which hold back existing home prices, continue to

comprise about 30 percent of sales—down from nearly 40 percent earlier in the year. However, as housing faces a seasonal slowdown, it is possible that distressed sales as a share of total sales will rise even as the number of distressed sales remains largely constant.

• The increase in the share of distressed sales may bring reported transaction prices down somewhat. Of course, the price reduction depends on the condition of the distressed property. Nearly two-thirds of distressed properties are in average or better-than-average condition which may help to lessen the downward impact on prices.

• Stable-to declining inventories should help to support prices, though buyers searching for the right home may have fewer options from which to choose. Very limited new construction means that buyers initially searching for a new home may find more selection among existing homes.

Home Prices

Sources: NAR, Case-Shiller, CoreLogic, FHFA, Census, HAVER

Home Price Data – Year over Year Change

Sources: NAR, Case-Shiller, CoreLogic, FHFA, Census, HAVER

Home Price Changes

*All data are not seasonally adjusted. Monthly changes should typically be computed only for Seasonally Adjusted (SA) data. Because these change rates are often covered in the media regardless of their suitability for analysis, they are presented here but should be used with caution. Annual (yr-over-yr) changes computed for Not Seasonally Adjusted (NSA) data give a measure that is not affected by seasonal fluctuations.

Data Series

Aug-11 Monthly Change*

Aug-11 Annual Change*

Sep-11 Monthly Change*

Sep-11 Annual Change*

Next Release Date

NAR Median Sales Price: Total Existing Homes 0.0% -3.4% -3.4% -3.5% 21-NovNAR Median Sales Price: Existing 1-Family Homes -0.3% -3.9% -3.3% -3.9% 21-NovFHFA House Price Index: Purchase Only -0.5% -4.0% -- -- 27-NovS&P/Case-Shiller HPI: Composite 20 0.2% -3.8% -- -- 9-NovS&P/Case-Shiller HPI: Composite 10 0.2% -3.5% -- -- 29-NovCoreLogic National HPI -0.4% -4.4% -- -- Mid-NovCoreLogic National HPI - Distressed Excluded 0.7% -0.7% -- -- Mid-NovNew 1-Family Houses: Median Sales Price -8.7% -6.9% -3.1% -10.4% 29-Nov

Sources: NAR, Case-Shiller, CoreLogic, FHFA, Census, HAVER

Data Series

Aug-11 Monthly Change*

Aug-11 Annual Change*

Sep-11 Monthly Change*

Sep-11 Annual Change*

Next Release Date

NAR Median Sales Price: Total Existing Homes 0.0% -3.4% -3.4% -3.5% 21-NovNAR Median Sales Price: Existing 1-Family Homes -0.3% -3.9% -3.3% -3.9% 21-NovFHFA House Price Index: Purchase Only -0.5% -4.0% -- -- 27-NovS&P/Case-Shiller HPI: Composite 20 0.2% -3.8% -- -- 29-NovS&P/Case-Shiller HPI: Composite 10 0.2% -3.5% -- -- 29-NovCoreLogic National HPI -0.4% -4.4% -- -- Mid-NovCoreLogic National HPI - Distressed Excluded 0.7% -0.7% -- -- Mid-NovNew 1-Family Houses: Median Sales Price -8.7% -6.9% -3.1% -10.4% 29-Nov

Spread of Existing Home Price ChangesYear over Year

Sources: NAR, Case-Shiller, CoreLogic, FHFA, HAVER

Supply and Demand Factors – Inventory

Sources: NAR

Supply – New Housing Starts and Permits

Sources: Census

Underlying Demand – Job Growth and Hires

Sources: BLS

Potential Job Growth – Openings

Sources: BLS

Housing Affordability

Sources: NAR

About the Price Data Series

Data Series Strengths/Weaknesses of Data SeriesNAR Median Sales Price: Total Existing HomesNAR Median Sales Price: Existing 1-Family Homes

FHFA House Price Index: Purchase OnlyWeighted Repeat Sales (WRS) Index, sourced from Fannie/Freddie purchase & refinance mortgages (excludes FHA, VA, Jumbo, Subprime)

S&P/Case-Shiller HPI: Composite 20

S&P/Case-Shiller HPI: Composite 10 CoreLogic National HPI CoreLogic National HPI - Distressed Excluded New 1-Family Houses: Median Sales Price Based on home builder interviews in the Survey of Construction

Most timely Data, broad geographic coverage, sourced from MLS and Realtor® board data, data in dollars, total exisiting includes condos and coops

WRS Index, sourced from County recorder data, weighted by property value; quarterly national index (not shown), monthly 10 and 20-city metro indexes and composites are 3 month moving averagesWeighted Repeat Sales Index, sourced from database of loan servicing and County recorder data

Sources: NAR, Case-Shiller, CoreLogic, FHFA, Census, HAVER