Thursday, November 29, 2012

CASE-SHILLER: HOUSE PRICES RISE 3% FROM LAST YEAR





As expected the long cycle decline is now over and liquidation is no longer driving the market. As I posted in late 2008, no constructive action would result in a five year work out in which mortgages would be resolved as they came due or went into market driven voluntary liquidation. That was the worst way to handle the credit crisis and it led directly to a sharp reduction in the number of potential borrowers which stalled the recovery.

There was a fix, but we did not go there. Today we have a weak market slowly rebuilding. This will take time, but expect the building component to lead as they are making deals work.

This will in time be understood as the administration's greatest failure. Yet today, few understand that it can be fixed even now. At least it would be a lot cheaper though a lot less profitable as there are no customers to rescue.

What ever the result, the USA is the beneficiary of ample cheap housing although that certainly was nobody's plan.

CASE-SHILLER: HOUSE PRICES RISE 3% FROM LAST YEAR

UPDATE:
Case-Shiller is right in line.

The widely followed house price index showed prices rising 3.0% year-over year, just a tad ahead off expectations of 2.95%.



ORIGINAL POST: The gold standard of housing indices comes out at 9:00 AM.

Nomura has the quick preview:

US Case-Shiller home price index (9:00 EDT): We expect the Case-Shiller 20-city home price index to show a 3.6% y-o-y increase in September as price gains continue to spread across the country (Consensus: 2.98%, previous: 2.03%). An increasing number of major cities each month are now experiencing year-on-year price gains – 17 in August compared with three in January.

The housing rebound is unquestionably one of the most important economic stories in the US and in fact in the world.

We'll be covering the number here LIVE.

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