Case-Shiller Housing May Release (March data)

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Housing Prices Continue the Plunge

The March data for the Case-Shiller Housing Index came out this morning. March was down 2.1% from February and March was down 18.6% over March 2008.

Here is an updated Case-Shiller chart (in log scale) (click images for larger view):


The 10-city index was 151.41 in March compared to my forecast from last month of 151.82. So the index dropped slightly more than the my ARIMA model forecast was forecasting (actual 2.1% drop vs. my forecast of 1.93% drop) which is surprising to me. I was actually sorta expecting the opposite (for it to not drop as much as I was forecasting). We need to be careful not to overread one month but this is not a good sign for housing prices.

Below is the month over month % change chart that I think helps to see what is happening month to month and to see the seasonal effect better:


The seasonal effect should be kicking in now (in fact last year it kicked in in March), so if by next month the monthly drop does not get reduced significantly (like to the -1.5% range from this months' -2.1%) then this would not bode well for the rest of the year. In otherwords, if the Case-Shiller does not hit the breaks now as it usually does then the rest of the year will look even lower when the negative seasonality kicks in.

I will post some more later today or tonight looking at the different cities in the index and an updated ARIMA forecast model run. For all my Housing and Case-Shiller Posts see here.
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