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CoreLogic Data Shows House Price Declines Slowing

ilene's picture




 

CoreLogic Data Shows House Price Declines Slowing

Courtesy of Lee Adler of the Wall Street Examiner

CoreLogic’s data for January closed house sales (mostly November contracts) shows a year over year decline of 3.1% nationally. The month to month decline was 1%. However, the 12 month rate of decline has been slowing sharply.

Corelogic Annual Rate of Change in House Prices- Click to enlarge

Annual Rate of Change in House Prices- Click to enlarge

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According to CoreLogic, 6 of the 10 largest metropolitan markets in the US showed year over year declines while 4 showed increases.

See full press release here.

By contrast, Housingtracker.net, which tracks listing prices in real time showed that January listing prices nationally were up 4% year over year, while being down 1% month to month in January, as active listing inventories tightened. Inventory was down 17% year over year in January.

According to Housingtracker.net the trend of declining inventory and rising asking prices has continued to the present:

As of March 05 2012 there were about 858,688 single family and condo homes listed for sale in the 54 metro areas we track. The median asking price of these homes was estimated to be $224,322. Since this time last year, the inventory of homes for sale has decreased by 20.5% and the median price has increased by 3.9%.

Listing prices rose 1.7% month to month in March, while inventory coincidentally also rose by 1.7%. This is a normal seasonal aspect of the housing market as both demand and supply begin to increase after a January low. The increase in March 2011 was also 1.7%. These were the lowest rates of March increase since 2007.

Over the last 6 years, subsequently reported housing prices have tracked real time listing prices with a close correlation. This is the first time that listing prices have had a positive divergence versus subsequently revealed sale prices for the same period. Whether this reflects the reduction in supply, or newly unrealistic seller expectations is not yet known, but if active listings continue to shrink in number, as long as demand remains stable even at these low levels, then prices should stabilize and begin to rise. The year over year rate of change data seems to support this trend.

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Comparative House Price Measures Chart- Click to Enlarge

Comparative House Price Measures Chart- Click to Enlarge

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I address the issue of whether the housing market has bottomed in If The Guilty (Mortgage Mafia) Are Never Punished, Housing Will Never Recover.

 

Get regular updates the machinations of the Fed, Treasury, Primary Dealers and foreign central banks in the US market, in the Fed Report in the Professional Edition, Money Liquidity, and Real Estate Package. Click this link to try WSE’s Professional Edition risk free for 30 days!
 

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Thu, 03/08/2012 - 10:22 | 2235704 adr
adr's picture

Home prices can't truly increase again without rising incomes. Go tell anyone with a $50k job that the average home price is $240k. They'll tell you, "I can't aford that".

The increase in home prices reflects the bidding wars for all cash forclosure properties. All these speculators are getting back in the game expecting massive profit soon as all the home buyers come flooding back. I can't wait until they get stuck holding the bag when the buyers never show up. Are buyers really going to flock to devastated towns that have lost their entire infrastructure?

Without fancy subrpime teaser rate loans there isn't any working person outside doctors and lawyers that can afford a home in much of the country. The scam of the century was making a person earning $30k a year believe they could afford a $250k home.

All of the idiot young couples making $75k combined buying homes are going to find out soon what reality is. You may have thought you could afford a $250k home. Or thought you'd save money buying a forclosure, only to find out you'll need to spend over $100k to make the home livable. All of a sudden the wife gets pregnant, and they really find out what life costs.

If you make $60k and have a wife and one kid your maximum monthly take home after taxes and health insurance is $3800. The mortgage and escrow on a $250k home averages around $1800. Utilities, trash pickup, etc average around $200 in the summer and $300 in the winter. So you've got $1800 for everything else. You'll spend a minimum of $900 on food. $100 internet and TV. Probably got $300 in student loan payments minimum. Maybe you skimped on your cars and only have $300 a month between two payments. You'll spend at least $200 a month for gasoline. OH SHIT!!! YOU'RE OUT OF CASH!!! Better pull out that plastic. You'll just charge all your food so you can use that money to pay the credit card minimums.

That is reality. People don't want to believe it. Average home values need to drop to $125k to bring affordability back in line with incomes.

Thu, 03/08/2012 - 10:10 | 2235659 ebworthen
ebworthen's picture

In fantasy markets the prices stay high (e.g. - California).

Housing is little different than oil or equities; all the QE and money printing is artificially floating valuation and preventing reality.

This is not a recovery, it is a band-aid finger in the dyke and the responsible citizens' ass by a bunch of unethical idealogues and banker robber barrons.

Fuck the bankers, fuck the politicians, fuck the liars and the cheats and the rapists; HANGINGS STILL NEEDED.

Thu, 03/08/2012 - 09:52 | 2235600 Diogenes
Diogenes's picture

How can you believe we are in an inflationary period but houses will go down? The only reason is, real estate already had its inflation then went boom. When the water is squeezed out the prices will take off again just like everything else.

Thu, 03/08/2012 - 09:27 | 2235523 AC_Doctor
AC_Doctor's picture

They are stabilizing for now until the 5 million homes in the shadow inventory come up for sale.

Thu, 03/08/2012 - 09:15 | 2235498 Seasmoke
Seasmoke's picture

so much fraud in the waters and yet people still want to believe that housing prices will be going up ???????

Thu, 03/08/2012 - 09:01 | 2235463 nickt1y
nickt1y's picture

New round of forclosures will be hitting the market soon. Supply and demand. What would you do?

Thu, 03/08/2012 - 08:56 | 2235445 q99x2
q99x2's picture

Dollar is losing its value.

Thu, 03/08/2012 - 09:37 | 2235555 LawsofPhysics
LawsofPhysics's picture

ALL fiats are losing value.  Lawyers, guns, and money (real money) will sort this all out eventually.

Thu, 03/08/2012 - 08:16 | 2235353 trilliontroll
trilliontroll's picture

Some chart comparing Australia, Canada, UK and US ( data October 2011):

" .. Overpricing of Med/Avg Home:

  Australia : 36 %

  Canada : 32 %

  USA :      - 7%

  UK:           120 %

..."

http://trendlines.ca/TrendlinesAustraliaCanadaUKUSARealtyBubbleMonitorCh...

http://trendlines.ca/free/economics/RealtyBubbleMonitor/RealtyBubbleMoni...

Thu, 03/08/2012 - 09:53 | 2235605 AN0NYM0US
AN0NYM0US's picture

Fucking Canada has been in a housing bubble since 50% ago 

 

the trendline charts are measuring the wrong thing - they should be looking at the home price to  carrying cost ratio

Thu, 03/08/2012 - 04:32 | 2235164 WebImocentra
WebImocentra's picture

If the house prices are still dropping, whouldn't be a better investment to buy a house then to pay rent? According some international sources a lot of Americans don't own houses but live in rent - so when will actually purchasing a house be a better investment? I suppose when the monthly bank tax is lower then the rent?

Webmaster at

Imobiliare Cluj

Thu, 03/08/2012 - 10:12 | 2235635 Shizzmoney
Shizzmoney's picture

Most of my peers 18-35, are renting.  They have too.....we ain't rich and we certainly don't make enough income to actually buy a home.  And those who do, work in the healthcare (pharmacy/optomitry) business or have a union job (carpenter/cops/medical personnel).  Banks aren't gonna lend in this environment to those employed in the private sector for the most part, because they know the market isn't stable enough to provide the stability in careers that keeps the money flowing in from month to month.

The banks know this becaue, well, they are the ones who crashed the economy and have the fucking receipt!

The reason why the market may be stablizing is because the rich real estate mogul and the 1% looking for side cash is buying up all the home, and flipping them for profit by rent seeking in high density areas like LA, Boston, SF, NYC, etc. 

As Mitt said about he thinks about a recession, "Time to buy, buy, buy!"

Thu, 03/08/2012 - 09:35 | 2235540 LawsofPhysics
LawsofPhysics's picture

Most folks can not get loans. With all the banks getting ZIRP (free money), why would they take any real risk and lend to people when they can lend (risk free) to the government for a few percent?

ZIRP is the fucking problem, there is a very real cost for creating capital and not actually creating any value.

Lawyers guns and money (real money) will sort this all out eventually.

Thu, 03/08/2012 - 03:39 | 2235112 infiniti
infiniti's picture

LA, in the decent 'hoods, is nothing but bidding wars and cash buyers. 3.5% APRs and plunging inventory levels will make this a very interesting spring.

Thu, 03/08/2012 - 09:28 | 2235527 AC_Doctor
AC_Doctor's picture

The bro's gotta have a crib somewhere.

Thu, 03/08/2012 - 09:46 | 2235549 LawsofPhysics
LawsofPhysics's picture

The point at which it gets interesting is when a few bro's get together and realize just how easy it is to simply take the fucking crib you want.  especially some of those "fresh from the theater" military bros.  You know, the ones that can't find work and are having their benefits and SS cut.

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