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February Case-Shiller Home Price Unadjusted Index Tumbles As Home Price Deterioration Accelerates
Unadjusted Case-Shiller data for February indicated that on a sequential basis the decline in home prices is accelerating. And this is even with every stimulus imaginable thrown at the problem. We can't wait to see what happens with the latest round of homebuyer subsidies runs out. As the press release states: “Existing and new home sales, inventories and housing starts all show tremendous improvement in their March statistics. The homebuyer tax credit, available until the end of April, is the likely cause for these encouraging numbers and this may also flow through to some of our home price data in the next few months. Amidst all the news, however, we should also pay heed to foreclosure activity, which have reached their highest level in at least the last five years. As these homes are put up for sales, we may see some further dampening in home prices. ” While we obviously disagree with the first sentence (see chart below for confirmation) the rest of the press release is somewhat accurate. February unadjusted data came in below July 2009 levels. The number was so bad even Goldman had nothing good to say about it. The double dip in housing is firmly here now.
Here is how the last 7 months of the CS seasonally unadjusted index looks like, in absolute terms...
And in on a sequential change basis.
From Goldman:
Home Prices Weakened In February
BOTTOM LINE: Case-Shiller index follows others in showing modest sequential weakening in home prices, supporting the view that transitory factors - the homebuyer tax credit, loan modifications, foreclosure moratoria -- helped stabilize home prices in 2009.
KEY NUMBERS:
S&P Case-Shiller home price index +0.64% in Feb (yoy) vs. median forecast +1.3%.
MAIN POINTS:
1. Although the S&P Case-Shiller index of home prices in 20 metro areas was 0.64% above its year-earlier reading in February, this translates into a 0.85% decline, not seasonally adjusted. S&P has recently cautioned against the use of its seasonally adjusted series given difficulties in pinning down the seasonal. For what it's worth, that index was down about 0.1%.
2. The Case-Shiller index follows others in showing renewed signs of weakening, which makes sense given that this index is based on a 3-month moving average of prices. Even so, other indexes have been weaker than the Case-Shiller. For example, the LoanPerformance indexes of sales (including distressed sales) has fallen for three consecutive months, by a cumulative 4.5%. The FHFA index is down 2.7% over the same period. (Both are seasonally adjusted.).
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Knowing this relevant fact in this efficient market.
So, should I buy REITs or should I buy REITs?
Definitely buy REIT's.
Especially SPG... don't mind the fact that when adjusted for dilution, it's at an all time high market cap.
buy buy buy!
I am in the market for a Greek Island, holding out for after deflation bargain basement prices.. screw gold and silver>> MY new investment plan: buy a greek Island and live La Dolce Vita.
But, but, but... there were 'green shoots', and 'less bad' employment numbers, and... and... [/sarcasm]
Haveta go pick up my PM order today. :-)
But... but...but Geithner says prices are going up LOL
from the wires:
Tuesday, April 27, 2010 12:40:29 PM
(US) Treasury's Geithner: Financial reforms need to be clear, have teeth, US economy is rebounding more quickly than many expected
- Sees businesses starting to hire workers and expand investments
- Home prices are rising, not falling
You don't understand. February is down because March will be better. Don't worry. All is well.
Let's look at the real story:
The Composite 10 is up 1.4% compared to February 2009.
The Composite 20 is up 0.6% compared to February 2009.
These are the first YoY price increases since 2006.
Goldman Sachs: "S&P has recently cautioned against the use of its
seasonally adjusted series given difficulties in pinning down the
seasonal."
Harry only believes what he wants to believe. Don't feed the troll.
there shouldn't be any seasonal adjusting when comparing yoy changes.
SA should be only relevant when looking at mom or qoq changes.
at least in my book.
0.6% is statistically significant? Even 1.4%? With the cautions about seasonal adjustments?
LOL
Thank you for asking the obvious. I assume your questions are rhetorical because the answer is obviously "NO".
Everything is significant when you're looking for confirmation of your belief system and world view. No one dares consider that a 1% improvement off levels everyone thought indicated the end of the world as we know it is most definitely not good news. When easy comps can't be beaten significantly, discard the word "significant" and simply stick with "beaten".
"You're living in a dream world, Neo."
seasonal adjustments (IOW hot and cold) although appearing insignficiant can be significant to your significant other...especially shrinkage.
Go shill somewhere else Wanger...
Harry, if you want to look at the "real" story why don't you start your own blog where you can talk endlessly about how great everything is. If you don't enjoy the fact-based research presented here feel free to move on to another site more to your liking -- maybe Yahoo! Finance.
Harry,
When you were a kid, did your mother have to tie a pork chop around your neck, to get the family dog to play with you?
Now that was funny!
Poor Harry convinced himself as a child that his dog was a vegetarian. Unfortunately the dog did not agree and quickly passed.
The real story just kicked in your teeth.
We can't wait to see what happens with the latest round of homebuyer subsidies runs out.
Then a new round of subsidies/stimulus/whatever will be put in place. Money printing is easy, you need paper and ink.
"Money printing is easy, you need paper and ink."
Dude, that's so old school. Now all that's needed is a keyboard and a (hopefully) secure connection to the Fed.
Must reflate bubble, must reflate bubble, must...
Can someone explain the meaning of "seasonally adjusted" being applied to home prices?
when prices plunge we will be in the middle of winter. when they rise 0.6 % Spring & warm weather will be here. Fire all the weathermen and look at home sales data for your weather forecast.
+1
And who is the largest holder of RMBS again??? Has anyone calculated the effect of record bankruptcies on long time values? What are we looking at? 10 years at least?
With a new crop of foreclosure candidates.. the Spring of 09 Buyers. Mkts can be cruel.
Seasonal adjustment of housing prices? Why? Case-Shiller has all sorts of odd adjustments. Among other things, they try to exclude foreclosures. Hard to defend that when foreclosures are a third of the market and climbing. Also, this is not just the usual big city bias. This is an exclusively urban index. Still, the trend is your friend.
Duck season, Wabbit Season, Home-Buying season. Makes sense to me ... There is a time to every purpose under heaven, and it kind of turns my stomach, Turn Turn Turn.
Lies... Cramer said house prices stopped falling last year. Who do you trust: your own eyes or Cramer? Exactly....
But..but...just yesterday they said there is less chance for a double dip!
anyone care to calculate the value of the fed's balance sheet now??
anyone care to project its value eoy given current trends?
Just uploaded a Dow weekly chart showing a bearish broadening top pattern.
And Euro is breaking down now.
MARKET UPDATES:
http://www.zerohedge.com/forum/latest-market-outlook-0
I talked to a realtor this morning and she is pretty nervous about the Tax credit (tax payer fiat give-away) expiring!!
NSA="No Screwing Around" with the numbers.
Raw data in ACTUAL sold and prices provides a better picture. The new home sales number was declared a "woohoo" moment because it was up 27% month over month; all the way back to 1967 levels.
This bullcrap has to stop. The inventory is the driver and the actual number of homes vacant is brutal. And AMERICA is out of qualified buyers. Unless the damned government is going to buy them and give them away my number is that only 51-54% home ownership is the correct range we SHOULD be in.
Damned bureaucrats are going to dick around until a REAL crisis sets in and they are well on their way to making that happen.
Stupid f'in pissants.