DataParty Don't Stop

Published: Wednesday, October 28, 2009 11:13 AM PDT

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Mark Goldman, a local mortgage broker and SDSU real estate lecturer, passed along some thoughts about the newest Case-Shiller numbers. Read his take, then let me know what you think:

My take - This is a positive sign, but we are not out of the woods yet on home prices. Positive Signs - Strong affordability - a function of price, income and interest rates. ...

First time home buyer tax credit set to sunset at the end of November. Even if it is extended, it will not indefinitely support home prices and sales activity.

NOD and Trustee Sales (homes in foreclosure process) continue at similar paces adding "must sell" inventory to market. Although, ForeclosureRadar.com guys do not think there is a lot of shadow inventory, I think it is a factor to keep in mind.

The seasonally adjusted increase is 1.5% for the month. That is 18% per year, and that will not be sustained.

I expect home prices to moderate in the near term.

I had a couple of other pieces I couldn't fit in the story last night:

Marigold Hernly, a real estate agent in City Heights whose clients are mostly first-time homebuyers, said the tax break's Nov. 30 deadline was the driving force for the market lately.

"From the standpoint of keeping things moving, it's huge," she said. "It may just all be psychological but, you know, it's the only thing going."
Frustration and frenzy were at the forefront of my chat with Jim Klinge yesterday about the housing market. He told me a fascinating tale of a buyer he's working with who offered more than $100,000 over the asking price -- all cash -- and still lost. He blogs about that situation today.
Sheldon Ruckens, the somewhat bearish mortgage consultant I quoted, has a radio show on AM 1000 KCEO where he discusses the housing market.

And here are some other stories to check out for local housing/economic news:

The North County Times (with new housing reporter Eric Wolff) looks at the impact on traditional buyers of the intense competition in the market.

The U-T's Dean Calbreath breaks down the newest USD economic index, which showed its sixth straight monthly gain yesterday.

What do you make of all of this? Leave a comment below (head to Survival if you're not already there).

-- KELLY BENNETT

1 Comments so far on this story...

If you actually read the Case-Shiller technical document from S&P's web site, you will see how abstract the numbers are--a fact cleverly hidden by apparently-simple headline numbers and tables of city-specific data they release. They use only single family house sales, exclude "anomalies," correct for length of time since the immediately previous one by pseudo-regression techniques, etc. Conclusions do not apply to condos, conversions, courthouse sales, etc. and depend on the mix of years-since-last-pre sale. It reminds me of a Psychology lab when we had to plot the number of bar presses by a rat in one-mionute intervals. To "clean up" the data, we analyzed the inverse of the square-root of the number of presses . Try using that to describe actual rat behavior!!! And C-S is more complicated statistically and removed from the actual real estate market than that.

Posted by hillcrester | reply to this comment
October 28, 2009 11:59 am

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