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US: Case-Shiller Home Price Index
| Consensus | Consensus Range | Actual | Previous | |
| 20-City Adjusted - M/M | 0.3% | 0.2% to 0.3% | 0.5% | 0.5% |
| 20-City Unadjusted - M/M | -0.1% | 0.0% | ||
| 20-City Unadjusted - Y/Y | 1.4% | 1.0% to 1.6% | 1.4% | 1.4% |
Highlights
S&P Cotality Case-Shiller reports continuing very muted annual house price inflation at 1.4 in December versus 1.4 percent in November for the 20-city measure.
The Econoday consensus looked for a 1.3 percent figure. These are very low numbers, and a source of disinflationary pressure in the economy.
The 20-city adjusted index is up 0.5 percent on the month in December from November, seasonally adjusted. The unadjusted month on month figure declines 0.1 percent.
The national index covering all nine U.S. census divisions is up 1.3 percent on year in December versus 1.4 percent in November. The 10-City index is up 1.9 percent compared with 2.0 percent in November.
Market Consensus Before Announcement
A trend-like 0.3 percent rise on month and the same 1.4 percent increase on year from last month is the call.
Definition
The S&P Corelogic Case-Shiller home price index tracks monthly changes in the value of residential real estate in 20 metropolitan regions across the nation. Composite indexes and regional indexes measure changes in existing home prices and are based on single-family home resales. Condominiums and co-ops are excluded as is new construction. Note that forecasters, in line with recommendations from Standard & Poor's questioning the accuracy of seasonal adjustments, track both seasonally adjusted and not seasonally adjusted monthly data for this indicator.
Description
Home values affect much in the economy - especially the housing and consumer sectors. Periods of rising home values encourage new construction while periods of soft home prices can dampen housing starts. Changes in home values, and the ability to draw upon expanding lines of home equity loans, play key roles in consumer spending and in consumer financial health.
Beginning with the onset of the subprime credit crunch in mid-2007 and with it a downturn in home prices, the ability of borrowers to refinance their debt into affordable fixed rate mortgages was sharply constrained. This in turn limited aggregate consumer spending and contributed to the depth of the Great Recession. From their peak in late 2006 and early 2007 to their nadir in mid-2012, Case-Shiller's home price indexes fell nearly 50 percent. The subsequent recovery proved slow but steady with the indexes finally surpassing their prior highs in early 2018.
