Last April ECRI’s U.S. Leading Home Price Index (USLHPI) strongly suggested that U.S. real home price growth would turn up. Indeed real home price growth has risen substantially since then and the new-found housing market strength was seen by many as proof that the economic recovery was intact and set to accelerate. However, last month we highlighted that USLHPI growth had turned down in the prior months and that it would be important to monitor its near-term performance.

With many economic indicators disappointing this month, monitoring the USLHPI has become even more critical because any change in the housing price outlook could rattle consensus perceptions about the stability of the overall economy.