For the remainder of November, I’ll be featuring excerpts from the November issue of my ‘Moving Markets’ newsletter. For a free subscription click on the link here: www.usawealthmanagement.com.
Let’s begin with the housing market. The Case-Shiller® home price index tracks residential housing prices in 20 metropolitan regions across the country.
Interestingly enough, the report issued on October 27, 2009 had a positive tone, but merely celebrated slowing declines in housing prices. In other words, prices of homes are still dropping in year over year terms, but not as fast as they once were. This from the report:
This report has been showing steady improvement over the last four months, reflected in year-on-year rates which have moved from high double-digit declines in the spring to low double-digit declines, at minus 10.6 percent for the 10 index and at minus 11.3 percent for the 20 index. Nearly all regions showed gains in August led by Minneapolis, up 3.2 percent for a year-on-year decline of 13.7 percent, and San Francisco, up 2.8 percent for a year-on-year rate of minus 12.5 percent. Las Vegas, where the year-on-year rate is minus 29.9 percent, continues to show declines but moderating declines, at minus 0.3 percent for August. The new and existing home sales reports, which also offer price readings, have been showing much more month-to-month variability than this report though year-on-year rates of decline have been moving lower and have edged into single digits.
How our perspectives have changed. Not that long ago, a report like this likely would have been viewed as negative. However, given the state of the housing market and quite frankly the state of our emotions, we are now celebrating news that’s not as bad as the news we heard last month. The simple fact is many of us desperately want to hear good news relating to this part of the economy.
According to the latest Case-Shiller® report housing prices are still falling, a trend we believe will likely continue through next year. This market may not ‘bottom” until sometime in 2012.
Some folks are keeping their powder dry when it comes to investing in real estate.
Securities offered through USA Advanced Planners (Member FINRA/SIPC). Advisory services offered through USA Wealth Management. USA Advanced Planners and USA Wealth Management are affiliated companies. The opinions expressed herein are those of the writer and not necessarily that of the above noted affiliated companies. This update may contain forward-looking statements, including, but not limited to, statements as to future events that involve various risks and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual events or results to differ materially from those that were forecasted. The information obtained from third party resources is believed to be reliable but the accuracy cannot be guaranteed.
This information is education in nature and, therefore, is not intended to constitute investment advice and should not be interpreted as a recommendation to purchase, sell or hold a particular security. Prior to making any investment decision, the services of an appropriate professional should be sought as investment related recommendations are dependent upon the personal situation of each individual investor. Investing in market related securities involves a risk of principal loss
