What is the S&P CoreLogic Case-Shiller National Home Price Index

An index that measures the change in the value of the U.S. residential housing market. The S&P CoreLogic Case-Shiller National Home Price Index tracks the growth in value of real estate by following the purchase price and resale value of homes that have undergone a minimum of two arm's-length transactions. The index is named for its creators, Karl Case and Robert Shiller.

BREAKING DOWN S&P CoreLogic Case-Shiller National Home Price Index

The S&P CoreLogic Case-Shiller National Home Price Index compares the growth rates of the residential real estate market. Individual metropolitan areas can be compared to the index to see if they are outperforming the national average. The index encompasses all nine U.S. census divisions and is released quarterly, according to S&P.

Metro Areas Covered

The S&P CoreLogic Case-Shiller 20-City Composite Home Price NSA Index seeks to measures the value of residential real estate in 20 major U.S. metropolitan areas: Atlanta, Boston, Charlotte, Chicago, Cleveland, Dallas, Denver, Detroit, Las Vegas, Los Angeles, Miami, Minneapolis, New York, Phoenix, Portland, San Diego, San Francisco, Seattle, Tampa, and Washington, D.C.

The index uses the following methodology, according to S&P:

"Repeat Sales Method. The repeat sales pricing technique is widely recognized as the most appropriate way to measure price changes for real estate.

• Index Approach - The index is based on observed changes in home prices and is designed to measure increases or decreases in the market value of residential real estate in 20 defined MSAs and three price tiers—low, middle, and high.

• Creation of Sales Pairs - The movement in the price of single-family homes is measured by collecting data on actual sale prices. When a home is resold,  the new sale price is matched to its first sale price. These two data points are called a “sale pair,” and the difference in the sale pair is measured and recorded. Sales pairs are designed to yield the price change for the same house while holding the quality and size of each house constant.

• The Weighting of Sales Pairs - The index is value-weighted and designed to control for the quality change in the homes being measured. Sales pairs are assigned weights to account for fluctuations in price that can be attributed to factors such as extensive home remodeling, adding a home addition, or extreme neglect. Time intervals between sales are also considered.

• Three-Month Moving Average - The index is calculated monthly, using a three-month moving average algorithm. Home sales pairs are accumulated in rolling three-month periods."