If Case-Shiller March Figures were accurate…
May
27
I know, I’ve been on this rant before … but every year or so, I just have to vent again. Mostly because I get tired of hearing one of my very good friends and/or highly intelligent financial advisors my clients are working with quote the index … ‘According to the Case-Schiller index prices are down over 40% in SF.’
Case-Schiller, oft touted as being the most unbiased, thereby accurate measurement of home prices is an index that started 21 years ago. There are no data points prior to 1988. It uses the year 2000 as it’s base-line and tracks the same single family homes that have re-sold. According to the Case-Shiller index for March 2009 home prices in San Francisco are down 46.1% from their peak in 2006.
Which means, if you are going to rely on those numbers literally, according to the Case-Schiller index, a Single Family Home that sold for $1,000,000 in San Francisco in 2006, was as of March 2009 selling for $539,000.
Now go find that sale!
Case-Shiller March 2009 Press Release [Standard & Poor's]
Here goes my Pet Peeve again the Case-Shiller Index [SFHomeBlog]
San Francisco as you know or should know is a MSA if you would like specific info by zip please consult with Fiserv which can provide that info, otherwise get use to SF being the MSA for the region.
ronald at May 27th, 2009 at 11:25 pm ( )Oh I know it well…which makes it even more irritating. They call is San Francisco when it’s really a nine bay area county with SF being one of the smallest within it. Trust me KNOW ONE know’s it’s the region which is one of my biggest beefs with Case-Schiller. It says San Francisco is down, not San Francisco, Bay Area; or the Bay Area, or San Francisco* and no lay people that hear the statistics know it, nor is it qualified in the press…dont get me started…
Meredith Martin at May 27th, 2009 at 11:35 pm ( )Oh and I did consult with Fiserv last year – you may see in the link to the blog post I did. That is available only to subscribers for $3500.00 so I passed, but feel free to link to the specific zip codes here – I would love that!
Meredith Martin at May 27th, 2009 at 11:38 pm ( )It is not the "nine county" bay area, nor is it SF proper. It is SF, San Mateo county, Santa Clara county, Alameda county and Contra Costa county. It is difficult to offer a critique of an index if you have never bothered to check out the contents – this is right on S&P Case Shillers website, and is not exactly difficult to find.
Anonymous at May 28th, 2009 at 3:15 pm ( )You know what Anonymous, you are right. I misspoke it is not the 9 Bay Area County. It was a full year ago I spent hours on their web site researching their methodology, to see if there was any real data that honestly pertained to San Francisco. I was going from memory. The reality is, as you can see from my postings I’m interested in accurate data as it pertains to SF, and if someone’s going to do it for me, and it’s accurate all the better!
Case-Shiller’s MSA consists of 5 Bay Area counties but you too are incorrect. One of the counties you quoted is not represented in the San Francisco MSA for Case-Shiller, and one you did not quote is.
Here’s a good game: go to http://www.StandardandPoors.com and tell me how long it takes you to find what counties are represented. Hint…it’s not in the Case-Shiller Home Price Fact Sheet….
Meredith Martin at May 28th, 2009 at 4:46 pm ( )It’s OK, you can relax Meredith…
In a few more years, on an inflation-adjusted basis, that $1 million place from 2006 could be selling for half the price.
I used to say “2012″ for projecting this kind of thing, but now I’m inclined to think it will be later.
sf jack at May 29th, 2009 at 7:01 pm ( )Thank you! Thank you! THANK you!
Case Schiller is a national average, kind of like the Dow Jones, but with less data and averaging over a larger market area.
Realize it represents twenty METROPOLITAN areas. They are averaging San Francisco figures with Vallejo, Tracy, Hayward an many other communities whose trends and price ranges are completely different from San Francisco's. Local markets and micro-markets are not at all represented by indexes such as Case Schiller. I have written several times about this and yesterday there was even a report from one of the major national builders, that 1st quarter sales prices have been increasing. Contrary to what trends the national graphs show.
Real Estate Raj at June 4th, 2009 at 9:58 pm ( )