Some key highlights from the report:
- The national index posted an annual decline of 3.9%, an improvement over the 5.8% decline posted in the second quarter.
- Detroit and Washington DC were the only two MSAs to post positive annual rates of +3.7% and +1.0% respectively. Detroit has now recorded three consecutive months of positive annual rates.
- It is a bit disturbing that we saw three cities post new crisis lows. For the prior three or four months, only Las Vegas was weakening each month. Now Atlanta and Phoenix have fallen to new lows too.
Remember – the Case Schiller data is a lagging indicator as the index is based on 60 day old data. It will be interesting to see how the data looks in the upcoming months to see if Europe’s financial crisis has any impact on home buyers.
Yesterday, the NY Fed released its quarterly report on consumer credit showing that consumer buying power may be weaking. For the first time since the recovery began, there were clear signs that in Q3, consumers started falling behind on paying their debts following several quarter of improvement:
This might be an early sign that consumers are either “throwing in the towel” on their underwater homes or that more and more people are reaching cut off dates for unemployment benefits. Either one is a potential red flag for the housing market and the US economy in 2012.