Denver home prices show annual increase for 1st time in 3 years

Tuesday, January 26, 2010

Case-Shiller Index: Denver home prices show annual increase for 1st time in 3 years

Denver Business Journal - by Mark Harden

For the first time in three years, home prices in the Denver area showed a year-over-year increase in the latest S&P/Case-Shiller Home Prices Index.

The closely-watched report from Standard & Poor’s, released Tuesday, reported home sales prices for November 2009. Out of 20 U.S. cities in the latest Case-Shiller Index, Denver was one of just four that showed a year-over-year increase in prices.

Denver-area home prices rose 0.5 percent between November 2008 and November 2009. The last time Denver saw a year-over-year price increase was in November 2006, according to a Denver Business Journal analysis of Case-Shiller data; it had 36 straight months of year-over-year price declines after that.

As recently as early 2009, Denver was showing year-over-year home price declines of 5 percent or more, peaking at a 5.7 percent drop in February 2009.

But despite the good news in the latest index, Denver still has a long way to go before home prices reach their previous summer 2006 highs. Denver prices now are at about the same level as they were in early 2004, according to the DBJ analysis of Case-Shilling data.

During the current downturn, Denver prices reached a low point in February 2009, when they bottomed out at levels not seen since mid-2001.

Nationwide, only Dallas and San Francisco saw larger year-over-year price increases in the latest Case-Shiller report, at 1.4 percent and 1 percent respectively; San Diego saw a 0.4 percent rise.

On the other hand, price declines in the 12 months ending last November were greatest in Las Vegas (down 24.5 percent), Phoenix (down 14.2 percent) and Tampa, Fla. (down 13.2 percent). The average for the 20 cities in the latest report was a 5.3 percent decline for the 12-month period.

Month over month, the Denver area saw a 0.5 percent decline in prices in November from the previous month. That followed a 0.4 percent monthly drop in October and a 0.5 percent decline in September. Before that, prices rose month over month for six straight months.

Nationwide, home-price data, although showing improvement, presents a “mixed picture” in most markets, said David Blitzer, chairman of the index committee at Standard & Poor’s.

“While these data do show that home prices are far more stable than they were a year ago, there is no clear sign of a sustained, broad-based recovery,” Blitzer said in a statement.

The Case-Shiller index is compiled by comparing matched-price pairs for thousands of single-family homes in each market. Standard & Poor’s and Fiserv Inc. publishes it.

mharden@bizjournals.com