In the Los Angeles Times story, David Blitzer, chairman of the S&P index committee, was quoted as saying:
â€œThis monthâ€™s report is marked by the confirmation of a double-dip in home prices across much of the nation. Home prices continue on their downward spiral with no relief in sight.â€œ
InÂ the secondÂ article, Forex quotes Mark Fleming, chief economist for CoreLogic:
â€œWhile the economic recovery is still fragile and one data point is not a trend, the month-over-month increase based on April sales activity is a positive sign.â€
The Case Shiller and the CoreLogic price indices are both very well respected. How can they come to seemingly opposite conclusions? There are two reasons for this.
Each report is actually looking at data from different periods of time. Therefore, they are not technically comparing apples to apples.
The CSI is reported with a twoâ€month lag and is based on three months of data. For example, data released in January 2011 was for the three months ended November 2010 (November, October, September 2010).
The CoreLogic HPI is published on approximately a 5 week lag from the end of the data collection period. For example, the CoreLogic January HPI will be published in midâ€March.
The Case Shiller report covered data several months old. This data would contain transactions where prices were negatively impacted by the large number of distressed properties on the market
However, inventories of distressed properties have decreased recently because the process of foreclosure has slowed. The CoreLogic data, being more current, would have fewer homes impacted by distressed properties. Therefore, prices would be higher.
The difference in time table helps explain some of the conflict in the conclusions of the reports. Once the banks again start to introduce more distressed properties to the market, prices will again be negatively impacted.
Prices of properties in your region will not be determined by the different price indices. Prices will be determined by the supply of homes available in ratio to the demand for those homes in your area. Whether you are buying or selling, check with a local real estate professional to help you analyze these numbers.
Call me if you want help with your home purchase. We have a team, Christine Norcross & Partners, at William Raveis and we can help you find your dream home in theÂ Wellesley Real Estate marketÂ â€“ Natick, Newton, Needham, Wellesley, Wayland, Weston and more.
Other articles on Buying and Selling Real Estate:
Overall A Positive Outlook on Wellesley, MA Real Estate
The Reality of Realty in Wellesley, MA