The Case-Shiller Home Price Indices are a widely recognized and respected set of measures for tracking changes in residential real estate prices in the United States. They were created by economists Karl Case, Robert Shiller, and Allan Weiss and are published by S&P Dow Jones Indices.
The indices are constructed using a repeat-sales methodology, which means they track the price changes of individual properties over time. This approach allows for the analysis of price movements while holding the quality and characteristics of the homes constant.
There are three main Case-Shiller indices:
The National Home Price Index: This index represents changes in home prices across the entire United States. It provides an overall picture of the country’s housing market.
The 20-City Composite Index: This index tracks changes in home prices in 20 major metropolitan areas, including cities like New York, Los Angeles, Chicago, Dallas, and more. It is considered a reliable indicator of housing market trends in these key regions.
The 10-City Composite Index: Similar to the 20-City Composite Index, this index focuses on changes in home prices in 10 major metropolitan areas. It provides a slightly narrower view of the housing market.
Each index is calculated using a weighted average of the price changes of individual properties within its respective area. The base value for all indices is set at 100 in January 2000. For example, a value of 200 would indicate that home prices have doubled since the base period.
The Case-Shiller Home Price Indices are often used by economists, analysts, policymakers, and industry professionals to monitor housing market trends, assess the health of the real estate sector, and make informed decisions regarding investments, lending, and economic policy.
It’s important to note that the Case-Shiller indices are typically released with a time lag. New data is usually published on a monthly basis, reflecting price changes from two to three months prior to the release date. Additionally, regional and local indices may be available, providing more specific insights into particular markets or areas.