Case-Shiller Price Trends Shifted in February

Since the second half of 2009, the general trend has been for the low-priced tier of the Case-Shiller home price index to rise strongly, the high-priced tier to drift mildly downward, and the mid-priced tier to split the difference with a more tempered increase. 

February bucked that trend.  The low tier still rose nicely, up 1.0 percent from the month before.  But the previously weak high tier rose nearly as much, increasing by .9 percent for the month.  And far from splitting the (miniscule) difference, the middle tier actually declined by .2 percent.

The graph of the price tiers’ changes since their respective 2009 troughs shows that the low tier remained firmly in the post-trough lead, having risen by 14.5 percent since its post-boom low point.  The middle tier was up 7.8 percent.  The high tier was up 4.9 percent from its April 2009 low but was still slightly below the levels it reached last summer.

Of course, the high tier looks more resilient and the low tier less impressive when measured from the peak of the housing bubble:

The high tier’s February increase might have suggested that a more across-the-board price rally was underway, but the weakness in the middle tier pretty much trashes that theory.  I think it’s too early to know the significance of February’s price patterns.  That is, if there is any significance at all.  These data series tend to jostle around quite a bit and the somewhat off February behavior could just be noise.

— RICH TOSCANO