Home Prices Drop Again in April

San Diego single family home prices as measured by the accurate-but-lagging Case-Shiller index took another hit in April. The overall index declined 2.6 percent from the prior month, 22.4 percent from the prior year, and 27.9 percent from the November 2005 peak.

As usual, those aggregate numbers hide some huge disparities between homes at different price levels. The high-tier index (accounting for the upper one-third of sale prices) fell 1.5 percent for the month compared to 2.7 percent for the mid-priced tier and 3.5 percent for the low-priced tier. The accompanying graph shows that this pattern has been in place since the beginning of the decline. The vastly different performance on the way down is pretty much the flip side of the differences we saw on the way up, when lower-priced properties rose a lot further due to the explosion in subprime mortgage issuance.

April’s decline in the aggregate index brought overall home prices back to a level last seen in November 2003. Adjusting for the effects of inflation as measured by the Consumer Price Index, home prices were just below where they had been in November 2002.

— RICH TOSCANO