Moderating recovery in US housing market

Home prices in Las Vegas and Phoenix, year-over-year change until august 2009, S&P/Case-Shiller index (source: NYT).

Las Vegas and Phoenix are experiencing prices declines of more than 30% trought august 2009, according to S&P/Case-Shiller database published this week. Look at this excepcional interactive chart from New York Times.

Case-Shiller report showed a continued, yet notably weaker, bounce in prices with the Composite-10 index increasing 1.28% on a month-to-month basis.

Composite 10 and 20 city index, 1992-aug-09, (source: Bespokeinvestments).

Read in New York Times:

Even as new figures show house prices have risen for three consecutive months, concerns are growing that the real estate market will be severely tested this winter.

Read in Bespokeinvestments:

Only Las Vegas and Seattle traded at their multi-year lows in August, while the rest of the cities analyzed have bounced.  The composite 10- and 20-city indices have now bounced 5% off of their lows, while three cities (Cleveland, San Francisco, and Minneapolis) are now up more than 10%.  Prices in New York and Miami are only up 3%, while Boston, Chicago, and Washington DC are up about 7%-8%.

On a year-over-year basis, Dallas, Denver, Cleveland, and Boston are the closest to showing year-over-year gains, while Las Vegas is down the most YoY at -30%. The composite indices are still down 11% versus August 2008 prices.

In my point of view, the problem is, acording to Fitch, nearly 90% of option ARM mortgage have yet to reset. So, foreclosures will continue to rise untill 2011, so real estate market isn’t ready to bounce. 

Year over year % change in S&P/Case-Shiller home prices, august 2009 (source: Bespokeinvestments).

New York, Las Vegas, Cleveland, portland, Minneapolis and Charlotte real estate index charts, august-09 (source: Bespokeinvestments).

Phoenix, Los Angeles, San Francisco, San Diego, Denver and Washington DC real estate index prices, august-09 (source: Bespokeinvestments).

Miami, Tampa, Atlanta, Chicago, Boston and Detroit real estate index prices, august-09 (source: Bespokeinvestments).