April Home Prices, Case Shiller NY Metro for April 2009 (sales, real estate)

[goonsquad]

Home price data is out for 2009. See the two attached charts. The first shows rate of change. April's value of 170.33 is 12.5% lower than the April 2008 value. This represents the steepest year-over-year decline to date. March data's decline was 11.8% year over year. This data indicates that home prices are currently falling at their fastest rate yet for NY metro.

The second chart shows percent off peak. NY Metro is now 21.1% off peak, compared with 19.7% for March.

[JG183]

Case-Shiller tracks repeat sales on a specific group of homes in each city.

it is a "1-size-fits-all" analysis that doesn't really fit everybody.

...there is no middle ground with you super-bears, is there ?

C/S makes thier money on market fluctations -- if things stay flat, they can't skim the market, so they tell you how bad things are to lowball the markets.

then later they raise thier expectations to push the markets up. then you're happy again and the C/S index is sacred. it's the old used-car-salesman spiel.

the problem with one-size-fits-all answers, though, is that they often don't. when it comes to the decision of when to buy a home, there is typically no single "right" answer. not everyone is equally vulnerable. someone with a steady job, high FICO scores, and who plans on staying in the house for at least 7 years needn't worry as much about what prices are going to do...

[goonsquad]

Originally Posted by JG183

Case-Shiller tracks repeat sales on a specific group of homes in each city.

it is a "1-size-fits-all" analysis that doesn't really fit everybody.

It tracks repeat sales for single family homes at arms length, ie any sale which was not an in-family transfer.

...there is no middle ground with you super-bears, is there ?

What does this mean?

C/S makes thier money on market fluctations -- if things stay flat, they can't skim the market, so they tell you how bad things are to lowball the markets.

then later they raise thier expectations to push the markets up. then you're happy again and the C/S index is sacred. it's the old used-car-salesman spiel.

You've gone off the deep end here. Fiserv, the company that compiles the data (and did so before they were acquired by S&P) gets the data directly from tax records and the MLS for completed sales. Perhaps you should acquaint yourself with their methodology before you continue to write them off:

http://www2.standardandpoors.com/spf...ndices_FAQ.pdf

the problem with one-size-fits-all answers, though, is that they often don't. when it comes to the decision of when to buy a home, there is typically no single "right" answer. not everyone is equally vulnerable. someone with a steady job, high FICO scores, and who plans on staying in the house for at least 7 years needn't worry as much about what prices are going to do...

This may be true in a normal non-bubble market but not in this one, where the entire market moves rapidly in one direction. In our case, NY metro has moved >12% south in one year and continues to fall at its greatest rate yet. I keep hearing people say to put in a low offer if you find a great house. This is all well and good, but most sellers aren't willing to acknowledge the fact that the market is still dropping and will continue to drop for the foreseeable future. Many people on the sidelines in our area are expecting 10-15% or higher decreases in home prices over the next year and I'm one of them. How many sellers do you think would be willing to agree to 15% off their asking price right now? So if your plan is to buy a home at 15% off current list prices, your only option is pretty much to wait it out. To your contention that price doesn't matter if you plan to stay for >7 years, save it. Take 15% off of a 400k house and that's a 60k drop in one year, plus maintenance, plus taxes, plus insurance. Compare this with the prospect of renting a similar house for around $2k and you can begin to comprehend why there are so many people waiting it out and so much inventory.

[goonsquad]

Moreover JG, my original post didn't even present any conclusions, just data. I find it interesting how wed you are to your position that you simply must contradict the data. Maybe it is self evident that the data contradicts the viewpoint that you stridently defend daily on these boards: that NY housing bottomed several months ago and that now is a great time to buy. Maybe it is just data in any form that you object to. We know that you like to shoot from the hip as your post above and countless others indicate.

Why not offer your own conclusions from the data instead? Perhaps you could show us where on either of these charts the bottom occurs in November of 2008.

[MoorestownResident]

What you fail to point out is that NYC and the 10 and 20 city averages are showing PRICE MODERATION from March to April. The 20 city average decline was roughly -0.5% from April to March - roughly a 6% annual rate of decline. In NYC, the decline in April was -1.5%, almost half of the decline in March. That's what is important - what is happening NOW, not what happened over the past 12 months. We know what has happened over the past 12 months, that is not new information. You cannot extrapolate the decline over the past 12 months forward, especially when their data are now showing a more modest pace of decline in the most recent month - which is 2 months old.

Lots of problems with CS data as well. If you must cite it, please do the appropriate analysis.

Drop In Home Prices Shows Moderation In April

[sholden]

Originally Posted by JG183

Case-Shiller tracks repeat sales on a specific group of homes in each city.

it is a "1-size-fits-all" analysis that doesn't really fit everybody.

So what's a better method than comparing the sale prices of arms length transaction on the same single family home over time and aggregating all of them (that data is available for)?

You are trying to track the change in prices of single family homes. All methodologies have strengths and weaknesses, so what is a better metric and why is it better for this job?

[elflord1973]

Originally Posted by JG183

C/S makes thier money on market fluctations -- if things stay flat, they can't skim the market, so they tell you how bad things are to lowball the markets.

Case Shiller is not a person or a company. They are two economists (Karl Case, Robert Schiller) who devised the methodology.

The index is published by S&P. The method is not a hatchet job created by someone with a profit motive (unlike e.g. NAR numbers), it is as good as any other method.

The only problem with the numbers is that they are not forward looking. The futures market partly addresses this, but it would be better if those futures were more liquid.

[elflord1973]

Originally Posted by MoorestownResident

What you fail to point out is that NYC and the 10 and 20 city averages are showing PRICE MODERATION from March to April. The 20 city average decline was roughly -0.5% from April to March - roughly a 6% annual rate of decline. In NYC, the decline in April was -1.5%, almost half of the decline in March. That's what is important - what is happening NOW, not what happened over the past 12 months. We know what has happened over the past 12 months, that is not new information. You cannot extrapolate the decline over the past 12 months forward, especially when their data are now showing a more modest pace of decline in the most recent month - which is 2 months old.

Lots of problems with CS data as well. If you must cite it, please do the appropriate analysis.

March decline was about 2.5%. Comparing two adjacent months side by side is not "the appropriate analysis". If you want a "second derivative" estimate, you need to do better than this. At the very least, you'd need to seasonally adjust, and then look at the volatility of the monthly numbers.

I maintain that the best forward indicator of prices available to us is the CS futures market, which predict a bottom (for the NY metro index) somewhere in the 135-150 range.

[MoorestownResident]

Wow, you guys are shooting blanks.

Here's the press release, take a big note of the first chart and the headline, it clearly shows a bottom formation being reached in their 10 and 20 city average with a more modest month to month decline in recent months. In other words, the pace of decline is no longer 'plummeting' it is modestly declining.

http://www2.standardandpoors.com/spf...ase_063055.pdf

The NYC monthly decline was -1.7%, down from -2.6%.

"The pace of decline in residential real estate slowed in April", says David M. Blitzer Chairman of the Index Committee, Standard & Poors.

Leave the analysis to the pros, if you want to doom and gloom, that's fine, but don't expect to pull a fast one over on the pros.

[NatasNJ]

Originally Posted by MoorestownResident

What you fail to point out is that NYC and the 10 and 20 city averages are showing PRICE MODERATION from March to April. The 20 city average decline was roughly -0.5% from April to March - roughly a 6% annual rate of decline. In NYC, the decline in April was -1.5%, almost half of the decline in March. That's what is important - what is happening NOW, not what happened over the past 12 months. We know what has happened over the past 12 months, that is not new information. You cannot extrapolate the decline over the past 12 months forward, especially when their data are now showing a more modest pace of decline in the most recent month - which is 2 months old.

Lots of problems with CS data as well. If you must cite it, please do the appropriate analysis.

Drop In Home Prices Shows Moderation In April

What you fail to point out in your month to month analysis is that your month to month view of the data is also based on a seasonal time period which historically has more sales and more buyers willing to buy. Hence the prices MAY be holding their own better since there are more buyers out there and that come the winter market where less people buy the numbers will be even worse. Hence why you look at the Y-O-Y sales numbers as a middle ground.

Neither tell the whole story obviously but looking to far out and to close at the data tends to give false readings.