Home prices still dropping in Twin Cities, but rate of decline improves

The annual rate of decline in Twin Cities home prices slowed somewhat in November. That's according to the latest report from Standard & Poor's Case-Shiller home price index. Prices fell 5 percent compared to November of 2010. That was better than the 6 percent drop reported for October.

And the Twin Cities' performance bucked a national trend. The annual rate of decline worsened in November for the Case-Shiller 20-city composite index. Of course, it's worth pointing out that the Twin Cities still had a steeper over-the-year drop than 20-city index, which fell 3.7 percent.

The picture in the Twin Cities is a bit murkier when you look at the monthly numbers. If you don't take seasonal factors into account (which are a big deal in a place with intense weather, like Minnesota), home prices fell 0.6 percent between October and November in the Twin Cities. But if you do take seasonal factors into account, prices rose a teensy bit: 0.1 percent.

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Experts usually insist on using seasonally adjusted numbers. The folks at S&P's Case-Shiller used to recommend doing so as well. But then they switched and now seem to prefer the non-adjusted numbers. They say there's too much weirdness with various foreclosure moratoria and other lending issues that muck up their seasonal adjustment process.

But that can make for a confusing picture when you've got the seasonally adjusted numbers pointing one way and the non-seasonally adjusted numbers pointing another way, as in this November report. That's why we typically prefer to look at the year-over-year numbers, which are more solid.

S&P officials say nationally there are few if any signs that a turning point in the housing market is close.

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