Similar to housing starts last week, the Case Shiller home price index (reported this morning) showed a solid improvement in the housing market versus last year. The 10 city Case Shiller index was up 7.3% y/y in January, and the 20 city index was up 8.1%.
While the numbers are encouraging, prices still have a long way to recover. A longer term look at the Case Shiller index shows that prices are mostly flat since hitting an initial bottom in 2009 and still down 30% from the peak. It’s now been 80 months since home prices peaked. For comparison, 80 months after the tech bubble burst the S&P 500 was back at all time highs.