Here goes my pet peeve again San Francisco Case Shiller Index
So I woke up this morning to NPR singing that the new S&P/Case-Shiller Index is out and San Francisco is down over thirteen percent?!!! My heart skipped a beat for a second because I was half asleep and I had a mini panic attack thinking ‘When did San Francisco drop so much when I wasn’t looking? That hasn’t been my experience in this market where did that number come from?’
Then I rubbed the sleep out of my eyes and woke up to remember (and this will always frustrate the life out of me), it’s not San Francisco County they are speaking of, my favorite 7×7 square mile bit of California. It is the dreaded/oft misstated San Francisco BAY AREA which includes Oakland, Fremont, Contra Costa, Marin, San Mateo and of course San Francisco. All of which are different markets with very different average sales prices and very different price appreciations/depreciations.
Don’t get me wrong I’m all for keeping an eye on numerical trends – GENERALLY. It’s just it makes my life difficult when I get clients that believe they are going to be able to write an offer 13% below asking on a single family home, that in fact is getting multiple offers. Details media! The devil is in the details.
So what is the true San Francisco proper (meaning SF county) S&P/Case Schiller index? God I would love to know. They do have that information – I did call a poor soul at Fiserv Inc, the parent company of the Case-Shiller Index, today out of pure curiosity, but it’s available on a subscription basis only for industrial clients – and for the $3500/mth subscription cost I figured I would let my curiosity die on this one….
What I did sniff out is the huge discrepancy in depreciation between the price tiers
even within the SF Bay Area index. For example the low Tier (under $545,294) went from 269.67 in Jan. 2007 to 192.12 in Jan 2008 – a 77.55 difference; whereas the high Tier (over $794,192) changed from 182.06 in Jan ’07 to 175.75 in Jan ’08 only a 6.31 difference. And since those numbers are proprietary to the Case-Shiller index I thought I would pop in a little memo on how they calculate them from their press release.