Zillow Forecasts 4.3% Yearly Decline in Case-Shiller Index

The June 10- and 20-City Composite Case-Shiller Home Price Indices are set to be released tomorrow, and here at Zillow we’re forecasting that the 20-city, non-seasonally adjusted index will decline 4.3% year-over-year (compared with a 4.5% yearly decline in May), but will rise 1.2% month-over-month.

We believe the 10-city non-seasonally adjusted index will fall 3.5% year-over-year (compared with a 3.6% decline in May), but will rise 1.2% month-over-month.

What does that mean for the market? Zillow Chief Economist Stan Humphries, over on the Zillow Research page, says “Monthly home value appreciation in June may mark the last hurrah before beginning to weaken in the back half of this year in the face of worrying macroeconomic signals that began to accumulate starting in July and ultimately suppressed July home sales.”

If you’re curious how we forecast the Case-Shiller Index, here’s a short explanation: We look at the current Zillow Home Value Index for June (which was released a couple of weeks ago), the May Case-Shiller numbers, and, since Case-Shiller includes foreclosure re-sales and Zillow does not, the national percentage of foreclosure re-sales in June. More details can be found on the Zillow Research page.