When is good news bad news?

It’s fairly safe now to say the housing price “crisis” has reached bottom and is on its way back up. That much is clear with today’s release of the Case-Schiller Index, which measures the resale price of homes.

The Minneapolis area prices jumped 4.6% in July (3.1% on a seasonally-adjusted basis). That’s the third straight month of increases. And it’s the largest one-month increase since Minneapolis was added to the index in 1989.

Half-empty: Home prices here are still 1.4% below what they were in January.

Half full: That’s a lot better than being 9.6% below January, which was the situation last April.

Half full: How do we rank compared to other cities in July? At the top of the heap:

City Change June/ July
Minneapolis 4.6%
San Francisco 3.3%
Chicago 2.7%
San Diego 2.5%
Atlanta 2.3%
Phoenix 1.8%
Los Angeles 1.8%
Washington 1.8%
Denver 1.5%
Cleveland 1.5%
Tampa 1.4%
Miami 1.3%
Boston 1.2%
Dallas 1.2%
Detroit 1.1%
Portland 1.1%
New York 0.8%
Charlotte 0.6%
Seattle -0.1%
Las Vegas -1.1%

Half-empty: How do we rank since the start of the year? Middle of the pack.

City Change Jan/Jul.
Dallas 7.5%
Denver 5.3%
Cleveland 4.9%
San Francisco 3.6%
Washington 2.5%
Boston 2.5%
San Diego 1.8%
Atlanta 0.6%
Charlotte 0.3%
Minneapolis -1.4%
Los Angeles -1.6%
Chicago -1.9%
Portland -2.4%
Seattle -3.2%
New York -4.0%
Tampa -4.3%
Miami -7.4%
Phoenix -8.9%
Detroit -9.4%
Las Vegas -15.6%

The folks at the blog Calculated Risk have examined all of this and declared it bad news:

The debate continues – is the price increase because of the seasonal mix (distressed sales vs. non-distressed sales), the impact of the first-time home buyer frenzy on prices, and the slowdown in the foreclosure process (with a huge shadow inventory), or have prices actually bottomed? I think we will see further house price declines in many areas.

  • kennedy

    I know of three prospective home buyers that I work with. All are rushing to close in order to get the first time home buyer money. All have upped their purchase offer higher than planned and justify it with the credit.