The Altos 10-City Composite declined 1.52% from the start of September. For the second consecutive month, home prices were down across the board; with price decreases in 25 of the 26 markets covered. Seasonality is evident in inventory trends, with since August, with inventory declines in 14 of the markets covered.
October 2010 Highlights
The Altos 10-City Composite is now at $465,968, off 1.52% from last month.
Continuing the trend from August, in September, home prices fell in 25 of the 26 markets covered.
Cities that felt decreases most sharply were Tampa (-2.27%), San Francisco (-2.96%), and Phoenix (-4.55%).
Fourteen of the 26 markets covered in this report showed increases in inventory, and nationally, inventory was down 2.24%.
TRENDS: September Home Prices
Once again, the Altos 10-City Composite fell in September 2010. Having declined consistently from its peak in 2009, the index was off 1.52% from August, to $465,968. As the market continues to correct, continued price decreases can be expected, likely until the early part of 2011, when the boost of the "Spring market" is felt.
Price decreases were most evident in Phoenix (down 4.55%), Tampa (down 2.27%), and San Francisco (down 2.96%).
TRENDS: Housing SupplyWe speculated that prices should continue to decline, especially after the expiration of the home buyer's tax credit. From the data I have seen the decline in prices really started in July and August. This fact was not reflected in the most recent Case Shiller index because it uses a three month weighted average. So next month we should finally start to see Case-Shiller roll over. About the only bright spot from this report was the decline in inventory in some areas. This should not be material because in the key bubble areas like Los Angeles and Phoenix, inventory is still increasing. The housing market will not stabilize until these areas do.
September 2010 brings with it a glimmer of light in the guise of decreasing inventory. While home prices are still falling, it is significant that there are fewer and fewer homes listed for sale. In fact, in only nine of the 26 markets that Altos follows in its monthly report were increases noted. The Altos 10-City index was flat in September, which could signal the beginning of the end of market volatility.
In September, 14 of 26 markets showed increases in housing inventory. Inventory was up most significantly in Houston (which posted the largest increase at 4.87%), Las Vegas, Los Angeles, San Francisco, and Phoenix.
Black Swan Insights
Case Shiller Index Flat In July
Southern California Home Prices Fall In August
FHFA: Home Prices Dip Again in July
Fannie Mae's National Housing Survey Results