Here we go again on home prices.
Every time we get this report, we also get all kinds of questions from viewers/readers about why some media outlets report it one way and some another.
So here goes:
The S&P/Case-Shiller Home Price Indicesreport prices in the top 10 and 20 housing markets monthly, as well as a national number quarterly. The report offers year over year percentage gains and losses, then month to month gains and losses, seasonally adjusted and non-seasonally adjusted.
In a normal world, which we currently do not inhabit, home prices vary month to month due to the types of buyers. Families generally buy in the Spring, looking to move up to bigger homes and make the move over the summer, so as not to disrupt school. Older or single buyers, also first time buyers, tend to be the majority in the Fall; they buy smaller and less expensive homes, thereby skewing the prices lower, just by virtue of what they're buying.
This is why I believe year over year is a much better indicator, since you're comparing absolute apples to apples. The trouble is that in today's world, the apples are mangled and mashed, thanks to all kinds of government intervention in the housing/mortgage market. The Feds have messed with taxes, mortgage interest rates and foreclosure inventories, which in turn make the usual seasonal shifts irrelevant. That's why this report began offering the monthly data with and without monthly seasonal adjustments.