Housing Holds – But in 2020?

Just out  Housing numbers:

YEAR-OVER-YEAR 
The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, covering all nine U.S. census divisions, reported a 3.3% annual gain in October, up from 3.2% in the previous month. The 10-City Composite annual increase came in at 1.7%, up from 1.5% in the previous month. The 20-City Composite posted a 2.2% year-over-year gain, up from 2.1% in the previous month.
Phoenix, Tampa and Charlotte reported the highest year-over-year gains among the 20 cities. In October, Phoenix led the way with a 5.8% year-over-year price increase, followed by Tampa with a 4.9% increase and Charlotte with a 4.8% increase. Twelve of the 20 cities reported greater price increases in the year ending October 2019 versus the year ending September 2019.
The charts on the following page compare year-over-year returns of different housing price ranges (tiers) for Phoenix and Tampa.

MONTH-OVER-MONTH
The National Index, 10-City and 20-City Composites all posted a month-over-month increase of 0.1% before seasonal adjustment in October. After seasonal adjustment, the National Index recorded a 0.5% month-over-month increase in October while the 10-City and 20-City Composites both posted a 0.4% increase. In October, eight of 20 cities reported increases before seasonal adjustment while 18 of 20 cities reported increases after seasonal adjustment.
ANALYSIS
“October’s U.S. housing data continue to be reassuring,” says Craig J. Lazzara, Managing Director and Global Head of Index Investment Strategy at S&P Dow Jones Indices. “With October’s 3.3% increase in the national composite index, home prices are currently more than 15% above the pre-financial crisis peak reached July 2006. October’s results were broad-based, as both our 10- and 20-city composites rose. Of the 20 cities in the composite, only San Francisco saw a year-over-year price decline in October.

The Price chart is our favorite part of this report.

However, we think that Housing Prices will begin to decline in Q1 2020 and you can see it in the percent change data here:

Also, remember this is all based on OCTOBER Data so things could be changing right now.  I expect it to show in February data which will be freported in April 2020.

Just by 2-cents worth… still gotta have a roof, right?

Write when you get rich,

George@ure.net

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George Ure
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7 thoughts on “Housing Holds – But in 2020?”

  1. A young guy operating a steam shovel woke me up this morning,asking me to move my car so he could do some work for the house being built next door to me.The house is not yet under contract.The one built down the block has remain vacant for 8 months after its completion.The end is coming.No sandwich boards will be needed announcing its arrival.

    • In Raleigh NC, houses sell as fast as they build them & they are building a lot of new homes. Used Houses in my area that go on the market, sell in less than a month. The downside is more traffic jams, especially as they build more roads to meet the demand.

  2. These price declines and upticks are sort of misleading. The price declines in San Francisco are due to buyers just wanting to get into real estate before year end and buying lower priced homes and condos. Thousands of new condo developments have been constructed this year and they are priced lower than a single family home. The boomers of those condo sales drives down the average price per sale.

    Seasonality has a bit to do with it as well…The higher priced homes are taking a bit longer to sell, but they will sell…just not until the wealthy people that are buying them are back from their extensive holiday vacations…

    The other stat is that pricing strategies have changed here. During the peak years of 2017 and 2018, Realtors priced low and watched the bidding war begins. It was like an auction where the auctioneer would start at a low price than use his do his chanting to drive up the price,

    Now, we are seeing sellers and their agents pricing at the desired selling price. Some agents…not me…price it a bit high and settle for the desired price. That has an affect on list vs. purchase price stats.

    Tampa and Phoenix are retirement communities…so it stands to reason that there is a bigger demand as Baby boomers retire at a rapid pace. Did you know that by 2030, all baby boomers will be 65 or older?

    Charlotte is growing from Millennials from New York and Boston wanting a less stressful lifestyle a a bit nicer weather. It’s the South’s new financial center and it’s bio-tech is growing as well.

    • Elaine and I have been asking the same thing: Time to sell the homestead and put the money “in the bank” and just wait for the crash (leasing until) and then buy back in and have money leftover?:
      Ah, but is no crash, then we’re screwed
      So the fully paid and stayed course is the one we’re still on.
      In a crash, you can’t trust banks – only things you can hold or make right in Ure own hands.

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