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Housing price trends

Everyone knows that housing prices are falling, right? This chart, however, is intriguing because it suggests that's not necessarily true. The chart comes from the RadarLogic survey of prices in 25 metropolitan areas, and, like the Case Shiller home price index, it has a substantial built-in lag of about 3 months. The price reflects the average cost per square foot of homes sold (not seasonally adjusted), and the most recent price comes from the average of sales in the 28-day period ending April 21st. There is some seasonality in the data (prices tend to rise in the second quarter of every year), so the best way to compare the trend in home prices is using a year over year comparison. On that basis, home prices are down about 5%. Compared to two years ago, however, prices are down only 3%. The comparable Case Shiller price index shows prices down only 1.4% in the two years ending March '11.

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