Wednesday, June 01, 2005

RE Futures

Now you can 'invest' in future contracts on various local median house prices at Bet house prices will go up, or bet houses will go down. More information at . This is a solid concept. However, right now the Hedgestreet housing market is pretty inactive. I'll be keeping my eye on Hedgestreet.


  1. It looks like the hedges are more illiquid than the housing market.

    Housing futures will never work. How are the market makers going to hedge against them? Are we just going to rely on speculators for liquidity?

    If this thing takes off, I see it as an addition trigger to the bubble burst.

  2. The market makers maybe would be speculators who do not have enough money or credit to bet on the real thing. On second thought, anybody can get a RE loan now.

  3. David, this blog is great.

    Keep up the good work!

    HedgeStreet can also be used as an predictive indicator.

    For example, the "AUG San Diego > $628,000" Yes/No hedgelet is significantly more expensive for "No" than "Yes". This means that the market is predicting that the median home price in SD will probably not exceed 628K.