Submitted by Garrick Hileman09.18.2008
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Betting closes on Mar 31 2009
The U.S. housing market has taken a beating. According to the S&P/Case-Schiller Home Price index, home values in twenty major metropolitan areas have declined by over 18% from their peak in Q2 2006
In the nation’s technology capital, Bay Area* home prices have fallen 26.8% since their peak in May 2006.
The big question is when will single-family home prices stabilize?
Prediction: The Case-Schiller San Francisco metro area index figure will continue to decline through March 2009.
For this prediction to be judged favorably, the Cash-Schiller index figure will need to decline each month from the previous month’s figure through March 2009.
*Note: The Case-Schiller San Francisco metro area includes homes from the following counties: Alameda, Contra Costa, Marin, San Francisco, San Mateo
Let the community decide. Place your bets below.
(Photo credit: Associated Press)
Current Community Consensus 72%Prediction Statistics
| Betting Closes: | Mar 31 2009 | Current Consensus: | 72.11% | Total Bets: | 76 |
| Today's Change: | 3.11% | ||||
| Life Time High: | 72.11% | ||||
| Life Time Low: | 29.94% |
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Based on futures contract traded at CMEX, the index will decline through September but will uptick in October or November. Looks like an ROI of about 2-3 months for an unfavorable judgment. Do you trust my analysis? Bet favorable at your peril :)
Wow! Was it what I said that caused the drop of 13%?
Hmm.. home sales up 13.6%! http://www.breitbart.com/article.php?id=D939E5SO0&show_article=1.
Home sales are going up a bit (in some places) as prices fall.
July numbers are out. Down 1.8%
http://www2.standardandpoors.com/spf/pdf/index/CSHomePrice_Release_09304...
Moody's just issued a report saying the bottom won't come until 2010:
http://www.cnbc.com/id/26959206
"The U.S. housing market will continue to struggle until at least next summer, according to the Mortgage Bankers Association, which is meeting this week in San Francisco." -- SFGate
Good lord I hope the declines continues, these house prices have ruined San Francisco and turned it into a sick resort for the shallow and empty
Latest report out with August number ... San Francisco led the month-by-month declines at -3.5% with 20 city composite at record decline of -16.6%.
http://www.smartmoney.com/breaking-news/smw/?story=20081028090224
See my first comment on this prediction .....
IMO, we are now within ROI of 1 or 2 months for an unfavorable judgment as monthly decline begins to moderate. Expect to see a monthly decline that is LESS than the previous month decline for September or October numbers. So far, PaperEconomy has been very accurate in its analysis. It shows monthly declines in 2008 including a large dip in August with a reversal beginning with September numbers.
Disclosure: I now have an AGAINST bet for this prediction
How will this translate to the Case-Schiller index? Regardless, it is a sign of bottoming if not recovery.
I'm guessing this doesn't bode well for this prediction to come true.
"The closely watched Standard & Poor's/Case-Shiller 10-City Composite Index plummeted 18.6 percent from a year ago, the steepest decline in 20 years of available data. The 20-city index dropped 17.4 percent, also a record."
That information alone may not present a complete picture. With new housing starts declining, the inventory in market will continue to dwindle as home sales continues to rise significantly. Natural supply and demand dictates that prices will stabilize and will start to reverse its trend. Given that this prediction ends in May (when March data is reported), there are still plenty of time for this to be come true. I am still inclined to believe that October number (reported in December) will buck the declining trend and render this judgment UNFAVORABLE based on this report.
Article from the WSJ on housing prices: http://online.wsj.com/article/SB122764977315457619.html
And the hits just keep on coming...
http://www.businessweek.com/the_thread/techbeat/archives/2008/12/googles...
Although, as noted in either this article or another on this news, the quicker the market heads to the bottom the greater the chance that this prediction fails.
@Garrick, I think you had meant to post that comment on the T-Mobile G1 prediction?
Oops, thanks for the catch, David. Here is the story I meant to post:
http://www.bloomberg.com/apps/news?pid=20601087&sid=azP8gnGVza2U&refer=h...
The latest news "Bay Area home prices still in free fall":
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/12/18/BUFK14QN2S.D...
Case-Schiller uses a specific method to calculate the index. It is not solely based on general home sales. That said, it hurts to be a home owner in the Bay Area the last few months. The article does seem to hint that it is more stabilized than before.
October numbers are out ... -4.18% relative to September.
November and December are going to be horrid, I'm sure. And, everyone is prediction a nasty first calendar quarter for '09 (for the economy in general). I simply fail to see this ending on a positive note for this prediction.
Not sure if brand new cars even depreciate that fast?!
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