With a few months left before we hit the normal seasonal lows in home prices Chicago has already come very close to the lowest home price levels reached last year. The Case Shiller home price index for December came out today and Chicago fared worse than all the other cities tracked except for Detroit. Single family home prices declined 2% while condo prices declined 4.8%. That put single family home prices back to April 2001 levels, having fallen a total of 34.6% from the bubble peak, while condo prices snapped back to March 2000 levels, having fallen a total of 36.2% from the bubble peak.
In looking at the home price changes on a year over year basis single family homes have lost 6.5% of their value while condos have lost 12.3% of their value. This continues the unbroken pattern of year over year price declines that has persisted for almost 5 years now.
In speaking about the national home price picture David Blitzer, Chairman of the Index Committee at S&P Indices, painted a pretty bleak picture of the housing market:
...the housing market ended 2011 on a very disappointing note. With this month’s report we saw all three composite hit new record lows. While we thought we saw some signs of stabilization in the middle of 2011, it appears that neither the economy nor consumer confidence was strong enough to move the market in a positive direction as the year ended.
After a prior three years of accelerated decline, the past two years has been a story of a housing market that is bottoming out but has not yet stabilized. Up until today’s report we had believed the crisis lows for the composites were behind us, with the 10-City Composite originally hitting a low in April 2009 and the 20-City Composite in March 2011. Now it looks like neither was the case, as both hit new record lows in December 2011. The National Composite fell by 3.8% in the fourth quarter alone, and is down 33.8% from its 2nd quarter 2006 peak. It also recorded a new record low.
In general, most of the regions also posted weak data in December. Eighteen of the cities saw average home prices fall in December over November. Seventeen of the cities have seen monthly declines for at least three consecutive months. In addition to both monthly composites, 10 of the cities saw home prices fall by more than 1.0% during the month of December. The pick-up in the economy has simply not been strong enough to keep home prices stabilized. If anything it looks like we might have reentered a period of decline as we begin 2012.
You can find this and other housing data on our Chicago real estate market statistics page.