Home prices rose slightly in May compared with a month earlier, appearing to have stablized at the lower levels that followed the end of the residential real estate bubble, according to the S&P/Case-Shiller Home Price Index of 20 major housing markets released Tuesday.
Prices were up 1.3% from April, and 4.6% from 12 months earlier.
The price rise might have reflected one of the last gasps of the government's incentive program, which paid tax refunds of as much as $8,000 to homebuyers if they signed a sales contract before May 1.
"It does look like the market was boosted by the tax credit," said Robert Dye, senior economist for PNC Financial Services. "It seems to have pulled some of the demand forward."
Wednesday, July 28, 2010
Home prices up in May
The S&P/Case-Shiller index was up in May:
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In DC, the index hit 182.10 up 1.45% MOM and 7.45% YOY. Prices in DC have moved up 15 consecutive months on a seasonal basis.
ReplyDeleteBut dont worry, Nonpartisan told us to "watch and learn" (WAL) as the index will go from 182 down to 100 by 2013.
CAW! CAW! CAW!
Partisan - I wouldn't crow too loudly. I'm still waiting for some more concrete numbers, but I'm seeing 10% declines over the peak in my hood.
ReplyDeleteClearly DC proper is not collapsing so quickly.
Montpellier - seriously?
ReplyDeleteThe reason I am crowing is because of Nonpartisan's delusional worldview whereby DC case shiller (currently at 182.1) will drop ALL THE WAY DOWN TO 100 BY 2013. Surely you can see how unbelievably stupid that is?
Then again, do you want to sign on to his worldview? Do you too believe that we will end up at 100 by 2013. I would love to hang that on you too, but honestly, I think you are too smart for that. Unlike Nonpartisan, you seem to have a handle on reality (your bearish, but realistic). Thus, I dont find much need to give you a hard time.
Then again, if you want to sign on to DC Case Shiller @ 100 by 2013 be my guest. Or if you want to throw your own personal projection out there be my guest.
Oh and for the record, I am calling bottom @ 160. As long as we stay above that, CAW CAW CAW!!!!!
Partisan, when is the 160 bottom? 2013?
ReplyDeleteYes, seriously; two closings this month, 10% and 15% off peak, respectively - one is on my block, one is two blocks away.
ReplyDeleteI don't think things are going to drop as low as Non-Partisan suggests, but I do not think the DC run-up in prices is all due to influx of wealthier residents. We've already gone back and forth about that in detail so I won't revisit it. I'll simply say: I see, in Petworth - my little 'hood - ~10% declines in May-Jul closings relative to peak. I also see lots of "shells" - run-down properties picked up by flippers - going for much saner '01-'02 prices. Traffic is slowing.
This is a very micro look, but I think there is a lot of discussion here where people hold up anecdotal evidence "proving" their point. The macro stuff won't emerge for a while, and I think it's too early to call.
Dina ElBoghdady's most recent pieces in the WaPo certainly point to you winning the bet regarding the CS index in '12. The drop in DC foreclosures is a bonus. However, the Realtytrack stories I've read don't break things out by neighborhood in DC. I think that's key. Clearly there are parts of town that will never drop, but a lot of those were already run up quite a bit.
The "boom" in DC real estate has been all about reclaiming blighted areas, and it's not yet clear that the macro trend is disconnected from the credit bubble as much as you claim.
The "boom" in DC real estate has been all about reclaiming blighted areas, and it's not yet clear that the macro trend is disconnected from the credit bubble as much as you claim.
ReplyDeleteAbsolutely, you're right about the nature of the "boom" in DC real estate. Where there's been significant gentrification, the run-up in prices will hold. In areas where there was no gentrification, there will be a lesser effect reflecting the improved health of the city overall from the addition of middle-class residents--but not the kind of gains we've seen in the "edge" neighborhoods.
One of the untold benefits of the collapse of the larger housing bubble is that "flippers" and those that have been holding DC real-estate in anticipation of massive price run-ups are now trying to consolidate their gains. There's a massive number of gut-rehabs going on in my neighborhood in NE.
Blighted properties that have been marring the surrounding blocks for decades are suddenly getting rebuilt, presumably to be put on the market in the near future. The folks who are selling these properties--properties which they probably bought for 20% of what they'll get in today's market--are still going to make a killing even at 10% off peak.
"Montpelier said...
ReplyDeleteI don't think things are going to drop as low as Non-Partisan suggests"
So no then, not "seriously". This is all I was trying to get at here - a single point about the CS index. I dont disagree with anything you said, and absolutely, certain areas (particularly in DC proper & parts of MD) look like they can ease away a bit more value, while other parts of the metro area continue to inch upward or stagnate.
My point was a very simple, somewhat narrow one. Anyone who thinks DC case shiller is going to 100 is so deluded as to be completely detached from reality. With that in mind I again say CAW! CAW! CAW!
"Anonymous said...
ReplyDeletePartisan, when is the 160 bottom? 2013?"
Not certain Anon. We hit 165 back in early 09, and that could be it. However, I do expect us to make another run at it this winter, and maybe even the winter after that.
So I guess my projection is "no lower than 160, and at any time between now and 2013"
My point was a very simple, somewhat narrow one
ReplyDeleteYou know, way too simplistic.
Let me be a bit more specific - when I talk of stable prices, I'm not talking about hipster-ville - I'm talking about WEST of Rock Creek Park: Tenley, Foxhall, Georgetown, etc. (west of 16th St., really).
Shaw, U/14th, CH, Parkview, Petworth, etc., etc., will, I believe, fall back to '02 pricing. Probably in 2013. So, I dunno where you are or bought, but those are my predictions.
I don't think the fall in DC has been as dramatic because layoffs haven't been as dramatic, but I do think that a lot of these prices reflect very heavily leveraged incomes - the same easy credit that existed everywhere in the country.
Let me be a bit more specific - when I talk of stable prices, I'm not talking about hipster-ville - I'm talking about WEST of Rock Creek Park: Tenley, Foxhall, Georgetown, etc. (west of 16th St., really).
ReplyDeleteDead wrong. The established neighborhoods will fall before the up-and-coming neighborhoods. That's because the newly "habitable" neighborhoods are relatively reasonably priced
The run-up in the areas you've mentioned is more akin to the speculative price increases we've seen in Sprawlsville. IOW, there's no change whatsoever in the immediate environment to justify the increase.
I think your irrational dislike for hipsters may be crowding your judgement. Especially given that most of these newly renovated houses in "hipsterville" were in fact bought by professional DINKs.
This comment has been removed by the author.
ReplyDelete"Montpelier said...
ReplyDeleteLet me be a bit more specific - when I talk of stable prices, I'm not talking about hipster-ville - I'm talking about WEST of Rock Creek Park: Tenley, Foxhall, Georgetown, etc. (west of 16th St., really)."
Montpelier - thats all very nice. Im sure some picayune neighborhoods in DC will crash. Yet, the fact of the matter is, I dont really care.
This post's subject matter was about Case Shiller. I responded with Case Shiller data, saying its stupid to think we get down to 100 in DC. Yet, something in my comment must have really gotten to you. So much so, that you felt absolutely compelled to reply - despite the fact that your reply is largely irrelevant to Case Shiller.
Again, if you want to believe that certain DC hoods will tank - fine by me, no dispute here.
OR, if you want to relate that to the point here (i.e. I disagree Partisan, U street will tank and drive Case Shiller down to 130...) thats fine too.
Nevertheless, the fact remains, DC Case Shiller is at 182, and the chances that it gets down to 100 by 2013 are zero. So, once again, may I so clearly state...CAW, CAW, CAW, CAW, CAW!!!