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"Prospects For A Home Run In 2015 Aren’t Good" - November Case-Shiller Confirms Ongoing Housing Market Slowdown

Tyler Durden's picture




 

In a day of furious disappointments, the Case-Shiller housing report, albeit looking at the ancient economic picture as of November, confirmed what most had known: that the growth in housing prices slowed down yet again on not only a Year over Year basis, which rose just 4.31%, the lowest annual increase since October 2012...

... but also dropped by -0.22% decline on a monthly basis, which may not sound like much, but was the worst monthly drop since February 2012!

 

The breakdown by city:

 

And from the report:

Home Price Gains Continue to Slow According to the S&P/Case-Shiller Home Price Indices

 

Year-over-Year

 

Both the 10-City and 20-City Composites saw year-over-year growth rates decline in November compared to October. The 10-City Composite gained 4.2% year-over-year, down from 4.4% in October. The 20-City Composite gained 4.3% year-over-year, compared to 4.5% in October. The S&P/Case-Shiller U.S. National Home Price Index, which covers all nine U.S. census divisions, recorded a 4.7% annual gain in November 2014 versus 4.6% in October 2014.

 

Miami and San Francisco continue to lead all cities, posting gains of 8.6% and 8.9% over the last 12 months. Nine cities, including Tampa, Atlanta, Charlotte, and Portland, saw annual growth rates climb more than other cities in November. 12-month growth rates for Detroit and Miami dropped the most among all 20 cities.

 

Month-over-Month

 

The National and Composite Indices were both marginally negative in November. The 10 and 20-City Composites reported declines of -0.3% and -0.2%, while the National Index posted a decline of -0.1% for the month. Tampa led all cities in November with an increase of 0.8%. Chicago and Detroit offset those gains by reporting decreases of -1.1% and -0.9% respectively.

The conclusion:

“With the spring home buying season, and spring training, still a month or two away, the housing recovery is barely on first base,” says David Blitzer, Managing Director and Chairman of the Index Committee at S&P Dow Jones Indices. “Prospects for a home run in 2015 aren’t good. Strong price gains are limited to California, Florida, the Pacific Northwest, Denver, and Dallas. Most of the rest of the country is lagging the national index gains. Moreover, these price patterns have been in place since last spring. Existing home sales were lower in 2014 than 2013, confirming these trends.

 

Difficulties facing the housing recovery include continued low inventory levels and stiff mortgage qualification standards. Distressed sales and investor purchases for buy-to-rent declined somewhat in the fourth quarter. The best hope for housing is the rest of the economy where the news is better. 2014 was a good year for job creation and weekly unemployment claims – good short term indicators – which continue to provide upbeat reports. Consumer confidence, helped by cheap gasoline prices, is strong, and a good GDP number is expected this week.”

4th housing dead cat bounce: over.

Source

 

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Tue, 01/27/2015 - 10:47 | 5710531 NoDebt
NoDebt's picture

Slow-down in ultra high end home sales is probably most of this- they have a big effect on the averages.  "Regular guy" houses never got up off the floor in the first place (and are still too high relative to incomes, historically speaking).

 

Tue, 01/27/2015 - 11:23 | 5710754 saveUSsavers
saveUSsavers's picture

"Regular guy" is renting from Blackstone

Tue, 01/27/2015 - 11:30 | 5710783 markar
markar's picture

Actually, "regular guy" houses did get way up off the floor thanks, in part to Blackstone--which is why "regular guy" is now renting from them.

Tue, 01/27/2015 - 10:46 | 5710533 Dr. Engali
Dr. Engali's picture

Gas prices are down and suddenly Zero's approval rating is backed up to 50%. Merikans are some stupid fucking people. Forget all the other shit he's done, as long as gas prices are down we like him.

Tue, 01/27/2015 - 10:57 | 5710598 NoDebt
NoDebt's picture

Around Philly in the late 1980s the Eagles were coached by Buddy Ryan (yes, same guy in case you were wondering).  He was not a particularly good coach.  Eagles were rarely more than first round playoff fodder.

But Buddy knew what his REAL job was:  Beat Dallas twice a year.  Which he did most years.  On that alone he is still remembered fondly in Philly as one of the great Eagles coaches of all times.

 

Tue, 01/27/2015 - 11:50 | 5710894 rpboxster
rpboxster's picture

Like Wayne Fontes in Detroit.  At the helm for the only playoff win since 1957.  

Tue, 01/27/2015 - 10:47 | 5710537 sandlapper
sandlapper's picture

We need deflation in housing values along the same scale as oil and maybe a millenial or two could afford that 30 year fix rate tax farm guarantee.

Tue, 01/27/2015 - 11:53 | 5710916 mtndds
mtndds's picture

So true.  I live in Socal and for anything below $650k you are living in a dog house with neighbors on either side selling crack or on welfare.  First time home buyers are really non existant.  Its mainly Chinese buyers or wall street firms that own.  Hard to compete with all cash offers.  Fuckers.

Tue, 01/27/2015 - 10:56 | 5710567 847328_3527
847328_3527's picture
How to prepare for your energy company's job cuts

 

"I always tell people not to depend on a corporate-sponsored life insurance policy, because in the event of a layoff, that insurance will be gone," said Ip.

 

http://www.bizjournals.com/houston/blog/2015/01/how-to-prepare-for-your-...

 

My relative works in Houston and says the mood in the energy sector is dismal. No one is even thinking about buying a house and most are already into a survival plan of zero discretionary spending so they can continue the mortgage payments, food for the family and heavy property taxes which he tells me are due in a month or two. He also said one bad aspect is most fo them held a stock portfolio of energy stocks so if they tap that they'll take a big loss.

 

It's a Double Whammy for them.

Tue, 01/27/2015 - 10:54 | 5710573 blown income
blown income's picture

Come to Lafayette La ....the hot,hot,hot oil services industry land , with no ocean, water,mountain views!!!!!

 

for the low,low ,price of $417k for a fabulous 1575 sq ft ...Folks...thats only $265 a sq ft !!! on a postage lot Mexican built home.!!!

 

never been a great time to buy with rates this low !!!!

 

http://www.zillow.com/homedetails/107-Beaulac-Ln-Lafayette-LA-70508/1142...

 

 

Tue, 01/27/2015 - 11:34 | 5710814 saveUSsavers
saveUSsavers's picture

sold for $367K in 2011, after commission no profit. OVERVALUED KRAP.

Tue, 01/27/2015 - 10:54 | 5710578 firstdivision
firstdivision's picture

Woah, woah, woah there Tyler.  WTF is the using non-seasonally adjusted numbers?  That's not how we do things in America!

Tue, 01/27/2015 - 11:01 | 5710614 Sisyphus
Sisyphus's picture

Hmm! Interesting!

A blog run by a person whose last name rhymes with "Pimp my ride" says that--"Case-Shiller: National House Price Index increased 4.7% year-over-year in November"

Decision, decision. Flapjack und a shigarette? Shigar und a waffle? Pipe und a crepe?

Tue, 01/27/2015 - 11:02 | 5710619 youngman
youngman's picture

Hey I got my first offer on my condo in over 6 years....200,000 low...but hey..its an offer

Tue, 01/27/2015 - 11:12 | 5710678 greatbeard
greatbeard's picture

>> ..200,000 low.

Not to be brutally honest, but after six years, maybe it's not low?

Tue, 01/27/2015 - 12:31 | 5711159 j.tennquist
j.tennquist's picture

I've seen the same thing.  Owners who have had their homes on the market for 4, 5, and even 6 years.  All of them probably have a Realtor(TM=BS) whispering softly in their ears. "The market is going to be roaring back any day now."

I am short sale, hear me roar!

But to complete the bipolar reality.  In Chicago, investors are buying rental properties and actually bidding them up in some of the worst neighborhoods (can you say Lawndale?)  They believe there is money to be made in Section 8 housing.   And I don't know that they are wrong.   All of this is not happening by accident. It's disaster by design.

Tue, 01/27/2015 - 13:19 | 5711401 Bemused Observer
Bemused Observer's picture

They ARE wrong, trust me.

Investing in rental housing is not a game for most people. There are costs that most don't consider, it isn't just about sitting around waiting for all the rent checks to come in. There are also property taxes, maintenance, chasing down deadbeats (and taking them to court), etc.

These failed landlords will soon be unloading those properties into an already soft market.

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