S&P / Case-Shriller Index Shows Growth In Housing Market Slowing

The S&P / Case-Shriller index of home prices in 20 major U.S. cities showed last week that while prices last November were up 4.3% from the previous November, growth is slowing compared to previous months. The index value recently peaked in August of 2014 at a value of 173.69, and has slowly dropped since then to 172.94 in November of 2014. The data supports recent predictions that the growth in home prices in 2015 will slow relative to 2014.

What Is The S&P / Case-Shriller Index?

The Standard & Poor’s Case-Shriller Index is a repeat-sales index of home prices in the United States, which is designed to reflect changes in housing prices on a quarterly basis. The index is normalized to have a value of 100 in the year 2000. The 20-city Case-Shriller index, which is shown above, reflects changes in the value of repeat sale single family homes in 20 major metropolitan statistical areas in the United States.

Recent Trends In The S&P / Case-Shriller Index

The graph below reflects the Case-Shriller Index values for the 20-city index between January 2014 and November 2014.  2014 showed significant growth between February and August, followed by decline.

Given that December and January are relatively weak months in the real estate market, one can only expect that the downward trend will continue in the next two months. The trend is in line with predictions that while prices in the real estate market will rise in 2015, that rise will not match 2014.

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