Case-Shiller Results
Most Cities Decline, Las Vegas was up just a little
Posted: October 27, 2010 by John McClelland
The Case-Shiller home price indices were released yesterday. Nearly all 20 cities experienced a decline. The reading is from August. The Las Vegas aggregate index saw a .1% increase. Of course, when you are dealing with increases this small and measurement error, the true population of prices could be anything. Up, down or flat. Nevertheless, it was actually surprising that it did not slide down further. There may be some lingering support from the homebuyer tax credit extensions (which went until Sept 30). In addition, heavy cash buying by investors, retirees and some first time buyers have been bouying the market.
Case-Shiller does produce tiered indices reflecting different price ranges. Not every tier showed an increase for Las Vegas. In fact, it was the high-tier that was responsible for the increase in the aggregate. We do expect some further declines in some of the luxury segments but the high-tier index is composed of homes $183,729 or greater. Those are not expensive homes and when the top 10% of your market begins around this figure, you know how far prices have slipped. Now it is hard to argue that we are not in a deeply undervalued situation. When you add price/rent and price/income empirics into the analysis, this conclusion is hard to escape.