NAR_grey_logo-01

Case-Shiller Price Index

In each Economic Update, the Research staff analyzes recently released economic indicators and addresses what these indicators mean for REALTORS® and their clients. Today’s second update discusses the Case-Shiller price index.

  • Case-Shiller data for January showed that U.S. home prices rose 7.3 percent from a year ago in the 10-city index and 8.1 percent for the 20-city index. All 20 cities showed year-over-year gains with Phoenix leading the way with a 23.2 percent gain and New York rounding out the list with a 0.6 percent price gain.
  • Case-Shiller data reported for January is a 3-month moving average of data from November, December, and January.
  • Last week, NAR released February data that showed an 11.6 percent gain in existing home sales prices from one year prior. In the time period covered by the Case-Shiller data release, NAR data showed a similar trend, gaining 9, 11, and 10 percent year-over-year in those months.
  • NAR reports the median price of all homes that have sold while Case-Shiller reports the results of a weighted repeat-sales index. Because home sales among higher priced properties have been growing more than among lower price tiers, the NAR median price has risen by more than the weighted repeat sales index—which computes price change based on repeat sales of the same property.
  • While the NAR median price does not measure change in price for the same properties, it can be computed much more quickly than a weighted repeat sales index, thus information is available sooner. As can be seen in the chart below, the trends in the data tend to be similar, so the NAR price index is a valuable early indicator of other housing price data.

Danielle Hale, Research Economist

As a Research Economist at NAR, Danielle studies tax issues, the wealth impact of home ownership, and different measures of home prices.

More Posts

Comments
  1. Janice McCrary

    Danielle,

    I have been asked the question of whether or not median home prices are a leading economic indicator. Can you help me with this question.

  2. T.J. Doyle, Marketing & Communications Manager

    Janice, while the NAR median price does not measure change in price for the same properties, it can be computed much more quickly than a weighted repeat sales index, thus information is available sooner, and the trends in the data tend to be similar, so the NAR price index is a valuable early indicator of other housing price data.