Clear Capital released their monthly Home Data Index Report today and it showed continued deterioration in national home prices. Prices are now off -6.8% from their August peak. It looks to me like the housing double dip is here and Ben Bernanke rolled out QE2 just in time to prepare for massive MBS purchases in 2011 when the banks hit another rough patch (via MarketWire):
Report highlights include:
- Micro Market Analysis: The Washington, D.C. MSA bucked negative national home price trends, posting positive quarterly and yearly price changes.
- Metropolitan Statistical Area (MSA) drilldown: Local markets exhibited wildly differing sensitivities to the current housing climate: some in the South and Midwest regions are in double-dip territory, while bright spots emerge on the East Coast.
- National/Four Region Overview: National home prices have changed -5.0% quarter-over-quarter. In fact, looking at national home prices since their mid-August peak, price declines are even more dramatic, changing -6.8%.
- Home prices as a nation remain 7.7% above their 2009 lows, but six of the largest local markets are presently experiencing a home pricing double dip (defined as prices dropping below their record lows experienced at the worst of the housing market crash).
“Although nationally, price trends are showing significant decreases, it is critical for policy makers, investors, and other users of home price data to understand that price dynamics at local levels differ significantly from the macro trends,” said Dr. Alex Villacorta, Senior Statistician, Clear Capital. “Our Home Data Index is unique in its ability to provide timely insight across price tiers — at both national and local levels.”
“For example, all six major metropolitan areas in California are out-performing both national and West region numbers in terms of yearly gains,” added Villacorta. “Conversely, four of the top markets in Florida are either in or very near double-dip territory, even though national prices remain nearly eight percent above 2009 lows. So, while national home price trends gauge overall home price movement, regional, metro and local housing markets will continue to respond differently to distressed inventories and national policy.”
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.