Housing Futures Predict Continued Slide in Prices

If the futures markets are to be believed, the real estate prices in all of the ten largest metropolitan markets in the country will be lower one year from today. The range of predicted declines is rather narrow, from -5.6% for Denver to -8.2% for Las Vegas. (New York clocks in at -6.0%.) While the consistency across geographic markets sends a strong message, it’s important to remember that the housing futures began trading on the Chicago Mercantile Exchange only last Spring and the market is still relatively small. “The [trading results] have some predictive value and I would not expect them to be off investors’ expectations by some order of magnitude,” says Richard DeKaser, chief economist for National City Corp who compiles his own market valuations. “But it is not a very deep market. It is traded very thinly. I would be reluctant to attach too much importance to the numbers right now.”
Home Futures: Price-Drop Seen for Top Ten Markets [CNN/Money]