On the surface, today’s Case-Shiller was pretty meh.House prices dropped nearly 3.5% year over year, and there was barely any sequential gain. In fact, the sequential gain was behind expectations.
But actually there are some big signs of a turnaround happening, and a continuation of a positive trend.
New Deal Democrat at The Bonddad Blog observes:
In today’s report, only 7 of the 20 metropolitan areas made new lows on a seasonally adjusted basis. Six of the 13 metro areas showing seasonally adjusted gains in this month’s report bounced off a low set just last month, so it could be noise. But once the price increases two or more months, there is more confidence that the corner has been turned.
Here is the number of cities that have already hit bottom in each monthly 20 city Case-Shiller report since last June:
June 2011 – 1
July 2011 – 2
Aug 2011 – 3
Sept 2011 – 3
Oct 2011 – 4
Nov 2011 – 6
Dec 2011 – 7
Jan 2012 – 13
Presumably some of the 6 cities that bounced off their January lows this month will resume their decline – but on the other hand, not all of them. In short, the trend the Case-Shiller index may have bottomed in January! Failing that, the trend is for it to make an overall bottom within a few months. I would venture by the end of summer.
What’s more, that sequential gain from January to February is the first one since last Spring.
The housing bottom may be close or here.