Case-Shiller: More Stable But Not Good
S&P/Case-Shiller released its November report on housing prices across the nation’s 20 biggest cities and the news wasn’t particularly good. There were some signs of stabilizing (and four cities have even seen price rises over the last year), but, as David M. Blitzer, chairman of the Index Committee at Standard & Poor’s, put it, “there…
S&P/Case-Shiller released its November report on housing prices across the nation’s 20 biggest cities and the news wasn’t particularly good. There were some signs of stabilizing (and four cities have even seen price rises over the last year), but, as David M. Blitzer, chairman of the Index Committee at Standard & Poor’s, put it, “there is no clear sign of a sustained, broad-based recovery.” New York appeared to have continued downward momentum, with prices off 1% from October and more than 7% from a year earlier; the 20-city index as a whole was down 5.3% over the year. U.S. News & World Report estimates that overall prices have another 5 to 10% left to fall. “We see a big backlog of distressed properties that could come on the market in the next several quarters,” Celia Chen of Moody’s Economy.com told the publication. The Case-Shiller report comes on the heels of a larger-than-expected drop in existing home sales.
A Look at Case-Shiller, by Metro Area [WSJ]
Home Prices Stabilize Further [U.S. News]
Tough Times for Housing Market Followers [Seeking Alpha]
Look at the chart, DCB, the rate of change has levelled off and the absolute prces have essentially levelled off in the 173-175 range. Is it that hard to see???????
If the NYC CS number was 174 in July and was 174 in Oct and 173 + in Nov then there’s been no further decline.
How hard is this to understand?? Whether or not it’s calculus or algebra, you still miss the point. A derivative is still a derivative.
Here’s some interesting reading from someone who knows A LOT about real estate.
http://www.ritholtz.com/blog/2010/01/an-insiders-view-of-the-real-estate-train-wreck/
The person who said the only important point is rate of acceleration has apparently lost the ability to objectively handle data. That’s the most absurd thing I’ve read in some time.
CSA is right on all counts. DIBS knows absolutely nothing about Calculus (First or 2nd Derivatives) or physics (acceleration).
The calculation DIBS is looking for is rate of change, which does not involve calculus. Very simple math.
ROC may be slowing, but that certainly does not mean the housing market has stopped declining. It hasn’t. That is what the numbers show. Nobody who actually knows anything about financial markets would confuse a slowing ROC for a major turnaround.
Dave is pointing out that we are falling at a slower rate than before. Forget all that talk about 1st and 2nd derivatives, he’s just trying to show off. All he’s really trying to say is, things are better now because they aren’t as bad as they used to be.Of course this is a faulty conclusion, but nonetheless, that what he’s arguing.
Any middle school kid who’s taken pre-algebra knows that when you multiply with a negative number, the product will always be negative. Last i checked negative numbers were still a bad thing when it comes to the value of one’s home.
Minard,
what DIBS is talking about is whether things are incrementally improving or worsening.
eg If last month, house prices were down 20% year-on-year and this month they are “only” down 10% then that is an improvement in sentiment, if not the actual price.
I appreciate relative movements but I also like to look at absolutes. As my old boss used to tell me, “you can’t eat a relative sandwich”
Minard…just within the context of the previous data…the chart that chicken put up
chicken, the raw data for that chart is as follows:
April 170.67
May 171.16
June 172.36
July 174.16
Aug 175.48
Sept 175.32
Oct 174.97
Nov 173.24
Your conclusion about the rate of change still in decline was wrong beginning in May. yes, Oct 7 Nov have broken that trend but to anyone looking at the chart, the overall steep decline from the peak has certainly abated.
Thanks for that link though. I’ve been looking for a way to get BBRG charts up on here!!!
sorry – delta = “absolute change”, not “absolute”