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People seemed to find the rate-of-change graph in the prior post interesting so I thought I’d follow up with a look at how all the individual Case-Shiller price tiers have been trending.
The results are found in the accompanying graph. The lines in this plot track the year-over-year changes to the three Case-Shiller home price tiers as well as the aggregate index. I made the timeline begin in January 2007, back when the annual price declines were only mildly negative, because “zooming in” made the whole thing a bit easier to read.
What the graph shows is that the annual rates of decline for both the low and middle tiers have turned up pretty sharply. Prices were still declining on a year-to-year (as well as month-to-month) basis as of December, but they were doing so more slowly than before.
And this trend has been in place for a while. The low tier’s rate of annual change bottomed out at -33.7 percent (yikes) in August, while the middle tier’s rate hit its low in September at -25.4 percent.
The high tier hasn’t declined as much, but it also hasn’t seen any sustained improvement in its trend. The December rate of change was slightly higher than November’s, but November was a new low.
Of course, the high tier’s rate of decline is still nowhere near as bad as it got for either of the two tiers at their low points. Even as of December, the high tier’s rate of change was slower than that of the low and middle tiers (though just barely, in the case of the latter).
But it’s interesting that while the decline has markedly decelerated for the lower-priced tiers, it has not done so for the high tier. This disparity dovetails well with the fact that the pace of sales for lower-priced homes has increased substantially more than for higher-priced homes.
— RICH TOSCANO