Summary
The most recent Case-Shiller report stated, that home price index has risen four consecutive months a sign of steady improvement and stabilization of the housing market.
The August date compared to the same data (August 2008) was down about 11.2 per cent.
There will be further softening of the Real Estate sales as well as home values.
Analysis
The Case – Shiller report gave euphoric news to the housing market watchers. Sadly the data might be correct, the information is old news. It is the last week of October and the data is totally different now, due to many factors such as the uncertainty of the economy, and the potential uncertainties of the housing tax incentives status to name a few.
Ten plus years ago everyone was tracking and discussing the ‘ Housing Affordability Index’ and the talk of the day was, that’ it is getting worse and worse’, hence price increases were rampant.(as well as how unsustainable the price increases are)
If we started tracking what the Housing Affordability Index is in the various local markets and compare them to the time period when we had a healthy economy and balanced home sales, then we could predict many housing trends such as the bottom of the price decline as well as the increase in sales. Until then we are using the SWAG method of forecasting price declines and housing improvements.
This author consults with leading institutions through GLG
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
