The best way to predict the future is to invent it. – Alan Kay
Or just measure really quickly. – me
Sometimes I feel like we beat this dead horse too much. But I’m feeling particularly smug today so I’ll take another whack.
The dominoes are falling as the traditional HPIs are starting to recognize that housing prices aren’t falling through the floor this quarter. It was only a few weeks ago that S&P Case-Shiller announced their March data and the Double Dip headlines screamed. Today, Radar Logic released their RPX data for April and is the latest of the HPIs to tick up month over month. For your refresher, here’s how history unfolded.
| Source | Date of Inflection | Date Published |
|---|---|---|
| Altos 20-city Composite Price of New Listings (weekly) | January 14, 2011 | January 17, 2011 |
| Altos 20-city Composite Median Price (weekly) | February 4, 2011 | February 7,2011 |
| DISCERN Housing Market Analysis | February 7, 2011 | |
| Altos 20-city Composite Median Price (90 Day Rolling Avg) | March 25, 2011 | March 28, 2011 |
| Altos Catfish Recovery Webcast | June 1, 2011 | |
| CoreLogic HPI | April, 2011 | June 1, 2011 |
| FHFA national home price index | April, 2011 | June 22, 2011 |
| Radar Logic RPX | April, 2011 | June 23, 2011 |
| S&P Case Shiller 20 City Composite | April, 2011 | June 28, 2011 |
The greatest trades happen when you see the inflection points coming before the rest of the market. How’s your foresight?
{ 5 comments }
It's always interesting to see the national trends and predictions. Last reports I heard were that sales were off for May – Nationally. Then the Florida reports sales were up. And in my county, basically unchanged. Go figure. It's all local and I'm not going to guess any more
Such phoney stuff, the media reports. Home prices have increased lately…really? Anybody see the listing agents increasing their prices? No? So 10 houses for sale in a given area, 8 listed for 300k and two listed at 400k each. Avg price is 320k, right? So two are in distress that are listed for 300k each and sell for 200k each. Now we have 8 homes listed for a total of 6x300k = 1.8M and two at 400k ea.= 800k = 2.6M divided by 8 = 325k each. So, did prices go up in that n'hood by 5k per home? No.
Six are still listed for 300k each and two are still at 400k each.
Multiply this with more homes and numbers and you can say prices are on the rebound…if you want to. (?)
Ed K.
Always nuanced, ain't it, Ed?
Interestingly, the math in your example shows why good housing data uses median pricing rather than average (mean). In your scenario, the median price is $300k all the way through. So, no, prices didn't rise.
The greatest trades happen when you see the inflection points coming before the rest of the market. How's your foresight?
Yeah, very true Mike.
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