Ok so we see an endless parade of housing stats (guilty as charged) and lately the news seems to be better, no?
The Federal Housing Finance Agency released their stats (covering conventional mortgage data – sub $729k mortgages) – They used a month over month headline:
U.S. Monthly House Price Index Estimates 1.7 Percent Price Increase From December to January
U.S. home prices rose 1.7 percent on a seasonally-adjusted basis from December to January, according to the Federal Housing Finance Agency’s monthly House Price Index. December’s previously reported 0.1 percent increase was revised to a 0.2 percent decline. For the 12 months ending in January, U.S. prices fell 6.3 percent. The U.S. index is 9.6 percent below its April 2007 peak.
Jan-Feb % change spiked last year and did the same this year, but somewhat higher. Here’s a look by Justin Fox at Curious Capital.
However, quarterly showed a large fall off in 4Q 08 so it will be interesting to see how Q1 09 shakes out.
The National Association of Realtors released their Existing Home Sale Report yesterday. They used a month over month headline:
Existing-Home Sales Rise In February
Existing-home sales – including single-family, townhomes, condominiums and co-ops – rose 5.1 percent to a seasonally adjusted annual rate1 of 4.72 million units in February from a pace of 4.49 million units in January, but are 4.6 percent below the 4.95 million-unit level in February 2008. Seasonal adjustment factors are more volatile in winter months, but sales rates over the past few months show dampened sales activity.
In other words, existing home sales are lower than last year. However, Calculated Risk and Chris Martenson counters NAR spin showing that the 5.1% increase is pretty ho-hum.
New Home Sales stats are being released Wednesday and consensus is a pace of 300k down from 309k last month.
The S&P/Case Shiller Indices are being released in a week (March 31) but not turn is predicted.
What does all of this mean? It means that there remains enormous spin from trade groups and government agencies. It means that consumers need to be skeptical of month over month gains because of seasonality.
Is there a possibility that housing is improving nationally? Not really but hope is a powerful thing that I try to consider month to month.
Tags: Case-Shiller, FHFA, Seasonal Adjustment, NAR, National Association of Realtors
J- It’s to the point where, no matter what the numbers say, I hesistate to make ANY interpretations–except that everyone has an opinion—and they must have the crystal ball as well, ’cause mine in the shop.
I analyze month to month changes for the Alabama Market. When I see a change from the “normal” month to month fluctuations that gets me thinking. For quite a while we have seen greater than normal reductions month to month which have resulted in the lousy year over year numbers. We have now begun to see better than normal month to month numbers, not a lot but some, That could result eventually in a true improvement. It will be a while and certainly we could really be seeing a ledge just before the next cliff, but I doubt it and hope not. Year over year is now useless to look at since the accumulation of weakness for many months has made the decline so dominant that one must look at month to month to get a sense of direction, but of course with reference to “normal’ seasonality. I use a ten year series of months with the months stacked on top of each other to best see the relationship. Best, Tom
Tom – Exactly, I agree that’s the way you should be doing it and your clients are better served. What bugs me about the releases we see is they are all out of context. In other words, to provide a month or month as “up” when it is not more “up” between 2 months compared to prior years is completely misleading.
Agreed, we in fact had a bit more up than expected in Feb at least in two Markets, Birmingham and surprisingly , on the coast, I also use a simple 12 month moving average of total dollar sales. On the coast the downward slope is “beginning” to level out. The shape of the curve has yet to flatten out in Birmingham or Huntsville but there are subtle signs of improvement in Birmingham, good sales and reduced inventory for a number of months in the fattest section of the market, under $200,000 here.
These charts are looking very “Alpine”, and we are in the valley.