Sept. Case-Shiller Slows to More Sedate, Sustainable Pace

Today, the S&P/Case-Shiller Home Price Indices showed that the non-seasonally adjusted (NSA) September 10- and 20-City Composites rose 4.8 and 4.9 percent, respectively on a year-over-year basis, in line with Zillow’s forecast released last month. On a seasonally adjusted (SA) monthly basis, the 10- and 20-City Composites were each up 0.3 percent, respectively, from August to September. The table below shows how Zillow’s forecast compared with the actual numbers.

“The days of double-digit home value appreciation continue to rapidly fade away as more inventory comes on line, and the market is becoming more balanced between buyers and sellers,” said Zillow Chief Economist Dr. Stan Humphries. “Like a perfectly prepared Thanksgiving turkey, it’s important for things to cool off a bit in the housing market, because too-fast appreciation risks burning both buyers and sellers. In this more sedate environment, buyers can take more time to find the right deal for them, and sellers can rest assured they won’t be left without a seat at the table when they turn around and become buyers. This slowdown is a critical step on the road back to a normal housing market, and as we approach the end of 2014, the housing market has plenty to be thankful for.”

Our forecasting model incorporates previous data points of the Case-Shiller series, as well as Zillow Home Value Index data and national foreclosure resales. To see how Zillow’s forecast of the August Case-Shiller indices compared, see our research brief from last month.