Explaining Southern California's economy

Case-Shiller: Los Angeles housing prices gain in September but pace slows

Existing Homes Sales Jump More Than Forecast

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Tract homes in Santa Clarita, California. The September Case-Shiller index shows prices in the U.S. rising 3 percent year-over-year.

The latest numbers show Los Angeles home prices increased in September.

The S&P/Case-Shiller index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The September figures are the latest available.

The September Case-Shiller index, the most highly regarded set of numbers on the U.S. housing market, shows home prices increased 3 percent over September 2011, the eighth straight month of price increases.  But for L.A. the story is a bit subdued.

The Los Angeles housing market got absolutely crushed during the financial crisis. At this stage, the city could use more robust price appreciation.

From August to September, prices in L.A. moved up 1 percent, which was slightly worse than August's 1.3 percent. The month-over-month number hasn't been higher than 2 percent on the plus side since May. 


Your U.S. economy is sending mixed signals

Retailers Report Stronger Than Expected Earnings For Janurary

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Shoppers and pedestrians in New York City. Consumer confidence declined to Nov. 2011 levels in August, according to the Conference Board.

It's starting to look like housing prices in the U.S. are forming a bottom. The latest Case-Shiller index, which lags by several months much of the other data on housing cranked out by various sources, is showing an ascending price trend across the country. Month after month, prices have moved up (although not always improving on the previous month's positive movement). 

Importantly, this is price we're talking about, not sales. Sales are important — they provide a sense of how much demand is in the market — but unless you look at sales data over a number of months, you can get distracted by noise. Rising prices, on the other hand, signal that homes are gaining value as an asset. This is what anyone who's planning to buy or hoping to get out of being underwater on a mortgage wants to hear.