From an atricle I read:

Incredibly, Robert Shiller, the Arthur M. Okun Professor of Economics at Yale University, and best-selling author of Irrational Exuberance, is involved. In fact, he is MacroShares’ co-founder and chief economist. Both ETFs are benchmarked to the well-known S&P/Case-Shiller Composite-10 Home Price Index of home prices in the country’s 10 largest cities.

So at current prices the supply isn’t that great, but as prices rise the supply will increase more than normal, which will restrict any future price increases (assuming such price increases occur).

By Kary L. Krismer @ 23:

RE: sid @ 22 – If C-S was up for April, I’d be shocked if it wasn’t up for May and June too. But that doesn’t mean much due to the season.

Did you predict it to be up during may, june last year also?

I doubt I made any such prediction, but good point anyway. The three month moving average was up for May and June 2008 from April, using the NWMLS data, but only just slightly, while C-S was down for those two months. So they don’t always move in lockstep, just like how this year for April C-S was slightly up even though the 3 month average for the NWMLS was slightly down. They don’t move exactly in lockstep, but they are highly correlated.

Given that May was down for the NWMLS, it being up for C-S is more questionable.

RE: sid @ 22 – If C-S was up for April, I’d be shocked if it wasn’t up for May and June too. But that doesn’t mean much due to the season.

Did you predict it to be up during may, june last year also?

it is just negative media there isn’t really a recession at all

Here comes the sun………….

Exactly Kary!
Doesn’t matter what my background is since I am not claiming to know much about real estate. I am just a normal guy who has bought and sold more than 1 home.
The bullsh*t comments being posted on this blog do smell of jealously, anger, financial inability of being able to get into the a house of their own.
Also guess what, people getting into the market now will define the market going forward.
Jonnes, wreckingbull and others are waiting for everything to crash and burn so that they are left standing to come sweep up those million dollar houses that will sell for less that $200K soon. But I guess people buying houses right now are spoiling their plans of home sweet home ownership because it might stop prices from falling much further!

So, it doesn’t matter what my background is because I am not the one making these harsh comments and neither am I predicting anything.

Want to make this site useful, help people who are either trying to sell with good profession advice from Ira/Kary/Greg and others. Or help new home buyers get some advice – not from doomssayers but from level headed people who have some substance behind what they are

WE DON’T HAVE A DUST BOWL THIS TIME

Hi Kary:

At least we have Safeways and such with food and excess outdated overstock going to food banks today, it sure beats having bums knock on your door for a sandwich….LOL

RE: Jonness @ 7 –

The inescapable truth: plenty of people have been buying during the last couple months, and they’re not pushing the bargain too hard.

What makes you say that? Some buyers have been negotiating pretty hard, and there are some areas (e.g. over $1,000,000) where the prices are greatly reduced.

But there are also others that really don’t care. They’ll offer full price just to get the place.

The inescapable truth: plenty of people have been buying during the last couple months, and they’re not pushing the bargain too hard.

The strange thing about it: they’re driven by non-events such as change in weather and a small rise in interest rates.

The really sad part: these buyers – regardless of what pejorative name you choose to give them (monthly payment buyers, fiscally irresponsible) – are the majority of the population, and the ones who make or break the market.

YOU CAN’T BE SURE OF THAT ANYMORE?

Hi Sid:

Can you be sure that the 9.5% unemployment today [and going up with no end] is comparable to the 16-25% unemployment levels during the Great Depression?

Here’s a report that even suggest the 6% unemployment last Fall was comparable to the 25% Great Depression rate; in part:

“….To compute the unemployment rate, the BLS divides the number of individuals by the total labor force, which consists of those over the age of 16 — employed and unemployed. The arithmetic applies only to the “civilian non-institutional population” which means it excludes individuals in the armed forces and in prison.

That wasn’t the case in 1933 when the unemployment rate was reported as 24.9%. The definition of the labor force in 1933, according to Lebergott, included individuals in the military and prisoners. It also counted individuals as young as 14.

More significantly, the definition of “unemployed” was not, according to Lebergott, limited to those actively seeking a job.

Several economists suggest that because of those differences, comparing the 24.9% “unemployment rate” of 1933 with the 6.1% rate today might not be appropriate….”

The rest of the MSM URL:

http://www.foxbusiness.com/story/markets/economy/jobless-rate-deceptive-depression-comparison/

Even Dr. Roubini, Dr. Doom, won’t admit America’s 9.5% unemployment rate compared to the Great Depression is a total joke.

Even the federal government’s Bureau of Labor Statistics documents my point, as June 2009 is Great Depression level in writing, at 16.5%, see the proof:

http://www.bls.gov/news.release/empsit.t12.htm

But you’ll continue to argue with the facts I’ve presented and expect our Great Depression economy to bounce back this year….LOL

The media’s latest nonsense is stating that our current horrifying unemployment rate [Great Depression level IMO] is a lagging indicator of the bounce back….LOL….is that like saying someone’s horrifying foreclosure papers on their home are just a lagging indicator you’re going to make money in RE soon?

Don’t get me wrong, I do hope you’re right, but relying on “doncha know” gut feel and trusting most of the discreditted media, that’s batting 000 on economic forcasting for years now, sounds more of a mathematical risk, than expecting to win the million dollar lottery.

Assuming you own RE, I do hope your home’s loan isn’t upside down and/or you bought too much RE investments clearly losing mass value this decade [and into the next decade, IMO].

Good Luck with your Pink Pony possible predictions Sid, you’ll need it :-)

How many are like DavidB over in P-I land, where he purposefully sold thinking there was a bubble coming?

How many are just current homeowners interested in future prices?

How many are renters who will only buy if they think there’s no chance that prices will fall further?

How many are people who have no ability at all to buy, and are just jealous of those in society who have been more successful than them?

This site focuses way too much on price. In another thread I’ve been debating Scotsman, and one topic that came up was the purchase of my new house and sale of the old. For that transaction future appreciation was maybe the 5th reason at best that I bought the new house, and future price declines was maybe the 3rd reason that I sold the old house. Future prices are not the be all and end all of financial decisions, and for that I’d point to the automobile market, where virtually every purchase is a stupid purchase if you just look at price.

Your highness Jonness,
I have a question for you since you make pretty aggressive statements – what academic or professional background do you have to say what you just said?
Have you ever owned a home?
Are you financially capable of owning a home if the market bottoms with another 10-15% down?

I think that’s a polite way of saying there are a lot of fiscally irresponsible people buying houses right now.

You cant be that sure anymore. If the recovery happens (which is what the market is predicting) then this summer might just be the bottom as far as affordability is concerned.

” So I think we are looking at 3 more strong months of CSI numbers”.
Not sure if I would call 0.2% strong but if last years seasonality in a crashing market is a guideline you might be correct. I.e a couple of months flat to “not so strong” increase in Q2 before we turn downhill with a vengeance again through Q3,Q4 and Q1 2010.

I think that’s a polite way of saying there are a lot of fiscally irresponsible people buying houses right now.

How come by September, everything goes to Hades in a hen basket again [see Tim’s 2008 data]?

Because that is when people who really want to sell or have to sell start making deals – they dont want to be stuck with the house for another 6 months until the next Spring selling season…

How come by September, everything goes to Hades in a hen basket again [see Tim's 2008 data]?

But whereas May 2008 was down, May 2009 will be up about .3%. So this time next month the 2009 bump will look bigger than the 2008 one did, and I expect it will continue for longer as well. The lower inventory numbers alone tell us that.

The median prices for SFH in King County are:

Feb 348
Mar 335
Apr 350
May 351.5

Kary’s earlier estimate of -0.223% had the sign wrong because there was a big shift to the lower end of the market in the NWMLS numbers during that time. I haven’t looked closely, but I don’t expect next month will show as strong a shift, so the CSI should be closer to the NWMLS.

I don’t know what June’s NWMLS numbers will be, but the CSI following that will also do well when the Mar number is shifted out of the 3 month average. So I think we are looking at 3 more strong months of CSI numbers.

What does this tell us?