By: Victor Normand
Published: December 2012
The S&P Case-Shiller Home Price Indices are among the most trusted sources of information on the condition of the nation’s housing sector. The report released on November 27, 2012 showed the national composite home price was up 3.6% in the third quarter of 2012 compared to the third quarter of 2011. Not all regions showed an increase but of the 20-city composites, only Detroit and Washington D.C. showed slight declines and New York was unchanged.
The Chairman of the Index Committee at S&P Dow Jones Indices, David M. Blitzer, commented “Home prices rose in the third quarter, making this the sixth consecutive month of increasing prices.” He went on to say that the nation is “…..now in the midst of a recovery in the housing market.” And it does feel like our local market is getting stronger as well, with home prices beginning to move higher.
The report goes on to say that nationally, prices today have come back to mid-year 2003 levels. Using some of the towns in our local market (Acton, Boxborough, Concord, Harvard, Littleton, Maynard and Stow), we decided to compare local data with the composite indices. To be certain apples were being compared to apples; we used the same methodology used by Case-Shiller when they took their measurements of similar “pairs.” Only actual sale prices for similar homes were used. We chose only single family homes with four bedrooms, two and one-half baths and 2,200 to 2,800 square feet of living area, and used average sale prices from the area Multiple Listing Service for our comparison.
The results show that, while our local market did not do quite as well as the composite, the third quarter 2012 average sale price was higher than the third quarter sale prices for 2011.
Third Quarter 2011 Third Quarter 2012 Change
$551,016 $558,811 1.3%.
When we looked back to see if the Acton area home prices had come back to 2003 prices as the composite prices had, we found that the third quarter average home price in 2012 of $558,811 was closest to the 2002 average.
Acton Area Home Prices
S&P Case-Shiller Home Price Indices
Overall, the Case-Shiller Home Price Indices for the composite of major cities in the country tracks closely to our own market. Which leads the “Resident Experts” to similarly conclude that home prices in our market are indeed moving higher.