What are the 'S&P/Case-Shiller Home Price Indexes'

The S&P/Case-Shiller Home Price Indexes, also known as simply the Case-Shiller Home Price Indexes, are a group of indexes that track changes in home prices throughout the United States. The indexes are based on a constant level of data on properties that have undergone at least two arm's length transactions. Case-Shiller produces indexes representing certain metropolitan statistical areas (MSA), as well as a national index.

BREAKING DOWN 'S&P/Case-Shiller Home Price Indexes'

The Case-Shiller Index was developed in the 1980s by three economists: Allan Weiss, Karl Case and Robert Shiller. The trio later formed a company to sell their research; that company was purchased by Fiserv, Inc., which tabulates the data behind the index. The data is then distributed by Standard & Poor's.

The group consists of:

  • The national home price index, which covers nine major census divisions. It is calculated quarterly and published on the last Tuesday of February, May, August and November.
  • The 10-city composite index, which covers Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, New York, San Diego, San Francisco and Washington, DC.
  • The 20-city composite index, which includes all of the above cities plus Atlanta, Charlotte, Cleveland, Dallas, Detroit, Minneapolis, Phoenix, Portland (Oregon), Seattle and Tampa.
  • Twenty individual metro area indexes for each of the cities listed above.

The indexes, aside from the national index, are published on the last Tuesday of each month at 9am EST. There is a two-month lag time in the data that is reported, so the report issued in May only covers home sales through March.

 

Trading with the Case-Shiller Indexes

The Case-Shiller Home Price indexes are used as the underlying pricing mechanism in CME real estate futures and options. CME real estate futures and options trade on different indexes representing 10 different metropolitan statistical areas and a composite index representing 20 metropolitan statistical areas.

The caveat is that the indexes are perfect representations of the housing market, because they include only single-family dwellings in their calculations. Furthermore, because some of the metropolitan areas are so large (such as New York City or Los Angeles), having just one value may not accurately represent all areas within that city.

For more on the indexes, see Understanding The Case-Shiller Housing Index.

RELATED TERMS
  1. Composite

    A composite is a grouping of equities, indexes or other factors ...
  2. Index Futures

    Index futures are contracts based on a financial index, which ...
  3. NYSE Composite Index

    The NYSE Composite Index serves as a gauge of the performance ...
  4. Nasdaq Composite Index

    The Nasdaq Composite index is a market-capitalization weighted ...
  5. Price-Weighted Index

    A price-weighted index is a stock market index where each stock ...
  6. Dow Jones U.S. Total Market Index

    The Dow Jones U.S. Total Market Index is a market-capitalization-weighted ...
Related Articles
  1. Investing

    Understanding The Case-Shiller Housing Index

    This index is a widely-used and respected barometer of the U.S. housing market and the broader economy.
  2. Investing

    3 Hottest Real Estate Markets in U.S.

    These three cities had the biggest real estate price gains in May.
  3. Investing

    Home Prices Rose in October Outstripping Affordability

    Home owners continue to benefit despite rising interest rates.
  4. Investing

    The Hidden Flaws of Index Investing

    Index investing isn't always better than active investing. Here's why.
  5. Investing

    Real Estate Indicators For Prospective Homebuyers

    If you want to buy a home but you’re holding out until market conditions show signs of improvement, housing indicators can help point the way.
  6. Investing

    How to Use Index Funds to Diversify Your Portfolio

    Index funds can act as quality diversification tools.
  7. Investing

    3 Index Funds with the Lowest Expense Ratios

    Learn about index mutual funds with the lowest expense ratios.
  8. Investing

    3 Types of Indexing for ETF Success

    ETF success relies on the index with which it is paired. Explore three index genres for tracking average market performance.
  9. Financial Advisor

    4 Top U.S. Equity Index Mutual Funds

    These four funds are among the best U.S. equities index mutual funds for core holdings in your investment portfolio.
RELATED FAQS
  1. How can I find out if a company I like is included in an index?

    Learn how to find out what indexes include a company's stock. Determine the importance of predicting future price movement ... Read Answer >>
  2. Why do investors use the S&P 500 as a benchmark?

    Learn about the advantages and disadvantages of using the S&P 500 as a benchmark for portfolio performance, and understand ... Read Answer >>
  3. Which benchmarks / indexes track the automotive sector?

    Explore some of the major benchmark equity indexes worldwide that analysts and investors use to track the performance of ... Read Answer >>
Trading Center