Continued Improvement in the Housing Market or Borrowing from the Future?

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The National Association of Realtors (NAR) reported yesterday that existing home sales in October rose to their highest level in more than two years.  Nationally, sales were up 10.1% over September and up 23.5% year over year.

Most of the increase in sales, however, was not in the western region, where sales were  only up 1.6% from the previous month.  (Oh, the devil is always in the details.)  And more “good news”:  The western region median price of $220,200 — clearly this is not San Francisco — was down 14.7% year over year. ...  Additional Details

Measuring by the Foot: Does it Make a Difference?

Several readers and clients have asked me recently about price per square foot metrics.  Certainly, if you’re trying to figure out how much a home is worth, it helps to get a sense of value by knowing what houses (or condos) are going for in the area on a per square foot basis and multiplying that by the size of the house in square feet.  Elementary my dear Watson.

However, others have been curious about whether there might be a discontinuity between the median price of homes and the median price per square foot, and what that might mean, especially in the context of how much each has fallen from its all-time high.  So I decided to take a look. ...  Additional Details

Noe Valley Postscript: Median Price Chart

I’ve been having an interesting discussion with a regular reader of theFrontsteps, where I first posted my chart on Noe Valley Percentage Change from All-Time High.  He disputes the fact that Noe Valley has fallen by 30% from its all-time high (reached in March of 2008) because he claims — I think — that March was aberrational.  I’ve looked again at the data for that month and I disagree.  What’s more I think that if you look simply at median prices (moving averages), they show a pretty extended upward trend from the beginning of 2006 through March 2008, with the exception of a dip during the Fall of 2007.  Here’s the chart (click to enlarge).  Enough said.  I’m moving on to another subdistrict. ...  Additional Details

Revised Absorption Chart, but the results are the same, only worse

Thanks, Jean-Claude for making me take a second look at my methodology on my Absorption Chart.  I had anticipated your point about the lag between listing dates and sales but had unfortunately gotten the formula backwards in my chart — basically dividing inventory by lagging sales, rather than forward sales:  moral of the story:  don’t do this stuff at 1 in the morning.)  So I redid the chart with the correct formula inserted.  (Excel groupies its =4*(AVERAGE(listings month 1, 2, 3)/AVERAGE(sales months 2, 3, and 4)). The data points at the end of the chart are averaged over shorter periods due to the lack of forward data. ...  Additional Details

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