As foreshadowed by the median price data, the Case-Shiller index for San Diego home prices rose in April.  Here’s a look at the CS index since the start of the rebound that began in early 2009:

This makes for the second up month in the past nine months.  There was some variation within the price tiers — the low tier was up a scant .1 percent, the middle tier was actually down .2 percent, and the high tier was up a fairly robust 1.1 percent.  The aggregate index of all homes was up .4 percent for the month.

I’ll include the usual longer term graphs below, but first I want to introduce a new data series to start watching.  The Case-Shiller numbers I usually report on are not seasonally adjusted: they make no attempt to compensate for the fact that prices tend to be stronger in spring and summer than in fall and winter.  This is good in that it shows us the actual degree of price changes taking place (or an estimate thereof, anyway), which is obviously interesting.  The problem is that it’s harder to ascertain the underlying trend: if prices are going up in the spring, for instance (as now), is it simply due to the typical underlying seasonal pressures, or would prices still be rising absent those pressures?  The way to answer that question is to “seasonally adjust” the data, which entails trying to back out the typical seasonal pressures so that you are just left with the underlying price trend.

The Case-Shiller folks do offer a seasonally adjusted series.  I have not historically used it because when I looked into it a while back, the seasonal adjustment seemed like it might be inaccurate.  I recall that in a single month, the seasonal adjustment pushed one price tier higher and the other two price tiers lower, which seemed like a very unlikely real-world outcome given that seasonal pressures should affect the market in a fairly uniform manner.  (Famed finance blogger Calculated Risk theorizes here on why this might be happening).

However, after some discussion with another excellent finance blogger, Jim Fickett of, I came around to the view that it would be really nice to know what the underlying price trend was once seasonality was taken out.  So I’m going to start tracking changes to the seasonally adjusted Case-Shiller index, with the caveat that the adjustment has produced some slightly wacky results in the past and may do so again in the future.  With that said, here is a post-trough chart of seasonally-adjusted Case-Shiller prices:

Once the typical boosting effect of springtime is removed from the picture, the CS index actually measures San Diego home prices as being down in April by .1 percent.  Assuming the adjustment is accurate, that means that all of April’s price increase (and then some) was caused by the spring boost as opposed to any inherent strength in the market.

We’ll watch both these series in the future as we try to figure out what’s going on.

Below are some longer-term CS graphs.  Since seasonal effects by definition even out over the course of a year, seasonality is not such an issue when assessing long-term trends.  Therefore I’ve continued to use the non-seasonally-adjusted numbers for the charts below.

Here are the CS index tiers since the bubble peak:

And here is the same chart, except that home prices have been adjusted for inflation (i.e. this chart shows how home prices have changed compared to everything else, or at least that subset of “everything else” that comprises the typical basket of consumer goods).  In inflation-adjusted terms, the aggregate index is very near a new low.  In fact, if we used the seasonally adjusted numbers here we might be at a new low.  Fortunately I’m too lazy to check.

Finally, here’s a longer term view going as far back as the tiered indices allow, also adjusted for inflation.  In aggregate, inflation-adjusted home prices by this measure are back to their early-2001 levels.

Rich Toscano is a financial advisor with Pacific Capital Associates*.  He can be contacted at

Rich Toscano has been observing the housing market for Voice of San Diego, with the occasional prolonged absence, since 2006. Follow him on Twitter at...

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