Sunday, May 31, 2009
U.S. Home Prices
S&P Case Shiller Home Price Index -- Seasonally Adjusted Home Price Values through March 2009:
S&P/Case-Shiller Home Price Indices, Seasonally Adjusted Home Price Values, March 2009 (published May 26), http://www2.standardandpoors.com/portal/site/sp/en/us/page.topic/indices_csmahp/0,0,0,0,0,0,0,0,0,1,1,0,0,0,0,0.html. Formula used to combine date columns: =DATEVALUE(TEXT(A3;"####")&"-"&TEXT(B3;"####")&"-01").
More S&P Case Shiller Home Price Index data and links:
* About the Indices
* Frequently Asked Questions
* Key Housing Indicators
* National Values
Also used is the LoanPerformance index: http://www.loanperformance.com/email/hpi/newsletterhpi1209.html.
The indices are designed to be a reliable and consistent benchmark of housing prices in the United States. Their purpose is to measure the average change in single-family home prices in a particular geographic market. The monthly indices cover 20 major metropolitan areas, which are also aggregated to form two composites – one an aggregation of 10 of the major metropolitan areas; the other including all 20. ... The S&P/Case-Shiller U.S. National Home Price Index is a composite of singlefamily home price indices for the nine U.S. Census divisions and is calculated quarterly. ... To be eligible to be included in the home price indices, a house must be a single-family dwelling. Condominiums and co-ops are specifically excluded...Houses included in the indices must also have two or more recorded arms-length sale transactions. New construction is excluded. ... Residential real estate represents a significant portion of many investors’ net worth. In 2007, the value of U.S. residential real estate totaled US$ 22.5 trillion compared to US$ 19.9 trillion in domestic equities. The S&P/CS Home Price Indices capture and measure this important asset class.
Frequently Asked Questions, S&P/Case-Shiller Home Price Indices, November 2008, http://www2.standardandpoors.com/spf/pdf/index/SPCaseShillerHomePriceIndicesFAQ.pdf.
What is so dishonest about the association of "subprime" and "poor people" is that it simply erases the fact that a lot of rich people have terrible credit histories and a lot of poor people have never even used credit. The "classic" subprime borrower is Donald Trump as much as it is "Joe Sixpack."
Reflections on Alt-A, Doris Dungey, Calculated Risk, August 11, 2008, http://www.calculatedriskblog.com/2008/08/reflections-on-alt.html.
Households should buy property only if they would also be able to afford it if interest rates increased. Moreover, they should finance their house purchase with a sufficient proportion of equity. Equity acts as a cushion, absorbing movements in property prices. In addition, banks should use discipline in lending practices, even in an environment of low interest rates. The prime considerations when granting loans should be the observance of maximum loan-to-value ratios and a conservative valuation of property.
Thomas Jordan: Low interest rates - blessing or curse?, Summary of a speech by Mr Thomas Jordan, Member of the Governing Board of the Swiss National Bank, at the Delegiertenversammlung des HEV Schweiz, Säntis, 19 June 2009, http://www.bis.org/review/r090624c.pdf?noframes=1.
Other indices (LoanPerformance HPI):