Thursday, December 31, 2009

S&P/Case-Shiller: October 2009 report

The S&P/Case-Shiller Home Price Indices report for October 2009 was released a few days ago. The report shows "that the annual rate of decline of the 10-City and 20-City Composites improved compared to last month’s reading."

“The turn-around in home prices seen in the Spring and Summer has faded with only seven of the 20 cities seeing month-to-month gains, although all 20 continue to show improvements on a year-over-year basis. All in all, this report should be described as flat.” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “Coming after a series of solid gains, these data are likely to spark worries that home prices are about to take a second dip. Before jumping to conclusions, recognize that the one time that happened at the beginning of the 1980s, Fed policy saw dramatic reversals, which is very different from the stable and consistent Fed policy we have today. "

"...As of October 2009, average home prices across the United States are at similar levels to where they were in the autumn of 2003."

Of note for the DC area is that sales prices declined in October compared to September, the first month/month decline since March. Moreover, the rate of month/month price increases peaked in June and the slope of price increases turned negative. While we may bemoan the negative turn of events, homeowners should consider ourselves lucky compared to Las Vegas: prices there have declined for 38 straight months and are now about 5% higher than those of January 2000. Talk about a lost decade!

On another note, this is my 90th - and last - post for 2009. I hope you've found this blog to be informative and helpful, if not entertaining [who else in the blogosphere talks about Bagatelle-brunching-bonus-bagging-too busy-to-meet-with-the-President-who-saved-our-asses Wall Street idiots?]. I'd like to wish each of you a safe and prosperous 2010!

The charts below reflect home price data for the Washington, DC MSA.




Tuesday, December 29, 2009

Schadenfreude

God love 'em, the WaPo made my day yesterday. Paul Schwartzman's article, "D.C. housing market's collapse lessens developers' swagger" describes the fall of the once mighty condo developer. The article's full of little nuggets from these former kings of the hill:

  • "The mood is a mood of humility and contriteness and self-reflection. There were a lot of people who were intoxicated by the times and the easy access to capital. A lot of them are gone."
  • "But we were just doing our job, taking on high-profile projects. I don't feel we were put in our place. We made some bad investments that didn't pan out. We lost money."
  • "You had a constant flow of money -- big money -- coming in... The idea was to make as much as possible and enjoy yourself."
  • "Of course, we got greedy... Everyone was greedy; we were aiming high... We're learning humility the hard way."
  • Developers remain adamant that they served Washington well, building wealth and reviving neighborhoods, even as they drove up prices and made some areas less affordable.
  • "We did wonderful things for the city... If the neighborhood's no longer completely down in the dumps, I also know it's harder to afford. It's an inevitable part of what we do. On a net basis, it was good for the city."

I don't know how to thank these guys for ratcheting up prices in the District so that you can't buy anything for less than $200,000. All those folks who bought condos in buildings like the Axis are thrilled to see their condos lose 20% of their value. And I'm sure all those folks who can no longer afford to live in the District are pleased, too. Might I add, as a taxpayer I'm simply delighted to bail out banks who lent money to these guys only to see their projects [and loans] go bust. Thankfully, none of the developers said they were doing God's work.

As I read this article, I concocted a fantasy where a few formerly-powerful, formerly-wealthy Bagatelle-brunching-bonus-bagging-too busy-to-meet-with-the-President-who-saved-our-asses Wall Street idiots confessed to the errors of their ways, as did these developers. I wonder if James Cameron would take a pitch for that movie as a sequel to "Avatar"? I've already got a title: "Avarice".

Saturday, December 19, 2009

MRIS November 2009 Housing Report

One dry, snow free day last week, MRIS released its data for November signed sales contracts for existing home and condos in the District. As in the reports for the preceding few months, sales and dollar volume are waaaaaaay up and prices are lower than the same period last year. More is selling, but for less. I must re-repeat: remember that we're now into the one year anniversary of the financial collapse kindly brought to us by the Bagatelle-brunching-bonus-bagging idiots who work on Wall Street so YoY numbers right now (sales and dollar volume) reflect the effects of last year's near economic meltdown.

Key points in November's data:

  • YoY, November was simply a blowout month. Aggregate dollar volume leapt 83.46%. The number of units sold almost doubled, up 98.08%.
  • Condo dollar volume more than doubled, hurtling 109.85%. Home dollar volume was respectable, too, surging 70.2%.
  • Condo sales volume was full or vim and vigor, too, bounding 118.25%. Home sales volume was no slouch, popping tall at 82.39%.
  • However, prices continued their downward spiral. Average prices fell 7.38%. Condo prices fell 3.85%, while home prices stumbled 6.68%. Only 4 bedroom homes experienced an increase in average sales price YoY, up 3.93%.

One thing that struck me is that the market doesn't seem to be behaving in a textbook manner. Eevery month since May there's been a 5-6 months supply of housing inventory listed and in November it shrunk even more to 4.44 months for condos and 5.15 months for months. Both metrics indicate a tightening supply of housing on the market. Yet prices still fall across the board, condos and homes. High demand and less supply don't normally equate to lower prices. So what's going on?

Detailed Data

Average Sales Price


Dollar Volume

Transaction Volume

Monday, December 14, 2009

MRIS November 2009 Sales Report: Preliminary data

MRIS released November's data for sales of existing homes in the District last Thursday. Prices continue to fall while more units are sold. Key points [YoY]:

  • Dollar volume boomed 83.46%
  • Average price is down 7.38%, median is down 6.43%
  • Unit sales volume [aggregate] is up a whopping 98.08%
  • Home unit sales up 82.39%
  • Condo unit sales up 118.24%

Sales prices were 92.64% of list. At November's sales pace, there is a 4.44 month supply of condos [a decrease from October] and 5.15 month supply of homes listed for sale [slightly less than October].

Before anyone starts popping the champagne bottle and getting their real estate license, remember that this data reflect the effects of the economic crisis brought upon us by Wall Street's Bagatelle-brunching-bonus-bagging idiots, the same idiots who, having tossed the global economy over the cliff only to be rescued from permanent unemployment by the US taxpayer, now somehow think they're the masters of the universe "doing God's work."

Analysis forthcoming.

Friday, November 27, 2009

District Sales: August 2009

I've finished processing, geocoding, and uploading sales data for August 2009. The table below shows August 2009 average and median sales prices and unit volume by zip code and the percentage change from August 2008. Once again, sales volume up, prices down.

State of the Market

In August the District recorded 736 residential sales. Overall, prices were down, sales volume was up. District-wide, average sales price fell 11.98% and the median sales price fell 7.94%. Unit sales were up a healthy - nay, robust - 31.9%. Dollar volume grew 16.09%. Overall, although 178 more units sold in August than during the same month in 2008, the average sales price was $60,324 less.

The condo market sparkled with a 28.3% increase in unit sales and a 22.52% increase in dollar volume. Condo prices fell; average sales price lowered 4.5% while median prices declined 9.28%. The number of homes sold surged 35.15% and dollar volume was up 12.04%. However, average and median sales prices for homes fell again, down 17.1% and 9.7%, respectively.

Only Ward 6 had positive price growth in August. Despite that, all wards experienced higher unit sales.

Condo sales ruled Wards 1, 2, and 6, constituting 60% and 80.45%, and 52.63% of units sold, respectively.

Just about every neighborhood in the District saw declines in average and median prices.

Distribution of Sales

The chart below shows the distribution of August's recorded sales by sales price.

Detailed Data

Sales by Neighborhood

Category by Zip Code

Category by Ward

Disclaimer:

  • Unlike MRIS, my data and analyses include new units [primarily condos] so there will be some differences in my conclusions about the market's state compared to a similar analysis based solely on MRIS reports, which only report sales of existing units sold and/or listed by real estate agents.
  • This analysis is of sales recorded by the District during the month as opposed to sales settled in the month, which is what MRIS reports, so there may be some discrepancies because of timing issues. However, I believe the data do provide a helpful indicator of trends in the District.
  • Sales may have been recorded by the District's Recorder of Deed during the month yet may not appear in the District's real property sales database, my data source, many months later. Consequently, those sales will not be in the month's analysis.
  • My analysis is based on District sales and appraisal data that I've collected and processed. I've deleted those sales that appear to be of questionable data quality. Errors are always possible.
  • My analysis is limited to condos and single family homes; I omit properties the District classifies as multifamily conversions. I'm sure I'm excluding some properties that are legitimate single family homes, but I want to eliminate uncertainty.

Tuesday, November 24, 2009

S&P/Case-Shiller: September 2009 report

The S&P/Case-Shiller Home Price Indices report for September 2009 was released today. The report shows "that the U.S. National Home Price Index improved in the third quarter of 2009, posting its second consecutive quarterly increase and further improvement in its annual rate of return."

“We have seen broad improvement in home prices for most of the past six months,” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “However, the gains in the most recent month are more modest than during the seasonally strong summer months. Fewer cities saw month to month improvements in September than in August in both seasonally adjusted and unadjusted figures.”

YoY, DC area prices are 4.98% lower with prices increasing 0.9% August to September. It's important to note that's a slower rate of increase, the slowest since April 2009

The charts below reflect home price data for the Washington, DC MSA.



Monday, November 23, 2009

Half the story

The National Association of Realtore (NAR) today released a report on sales of existing homes in October.

Existing-home sales – including single-family, townhomes, condominiums and co-ops – surged 10.1 percent to a seasonally adjusted annual rate1 of 6.10 million units in October from a downwardly revised pace of 5.54 million in September, and are 23.5 percent above the 4.94 million-unit level in October 2008. Sales activity is at the highest pace since February 2007 when it hit 6.55 million.

Lawrence Yun, NAR chief economist, was surprised at the size of the gain.

I won't go into an analysis of why it's not surprising that NAR's economist was surprised, I leave that to his fans. I will note, however, that it's only in paragraph 10 of a 19 paragraph report that NAR mentions that prices are down.

The national median existing-home price3 for all housing types was $173,100 in October, down 7.1 percent from October 2008. Distressed properties, which accounted for 30 percent of sales in October, continue to downwardly distort the median price because they usually sell at a discount relative to traditional homes in the same area.

The second sentence is an excellent example of a "blinding flash of the obvious". But, moving on, so of the 500,000 homes that sold in October, 150,000 of those sales were distressed properties? Why am I reminded of the line "we lose money on every sale but we make it up on volume"?

Wednesday, November 11, 2009

MRIS October 2009 Housing Report

MRIS released its data for October signed sales contracts for existing home and condos in the District yesterday. As in the reports for the preceding few months, sales and dollar volume are up and prices are lower than the same period last year. More is selling, but for less. I must repeat: remember that we're now into the one year anniversary of the financial collapse kindly brought to us by the Bagatelle brunching idiots who work on Wall Street so YoY numbers right now (sales and dollar volume) reflect the effects of last year's near economic meltdown.

Key points in October's data:

  • YoY, aggregate dollar volume jumped 17.02%. Condo dollar volume leapt 30.52% and that of homes grew 10.49%.
  • Sales volume was strong, increasing 40.58% YoY. Condos and homes both shared in the positive growth, increasing 33.88% and 45.89%, respectively.
  • Prices continue their tailspin. Average prices fell 16.76%. Condo prices fell 2.51%, while home prices dropped 24.26%. As in September [and August], not a single home category experienced higher prices YoY.
  • At October's sales rate, there is a 6.11 month's supply of condo units on the market, 14.23% more than September. For homes, 5.27 months, 17.53% less.

By the way, if you ever want to hear what Bagatelle brunching idiots who work on Wall Street sound like, tune in to Sirius Radio on Saturdays from 3-6PM to listen to dance channel BPM's "Bagatelle Brunch" broadcast. If you listen real close between the sounds of David Guetta [turn off the sound before you click or you'll be rocking the house] and Paul van Dyk [someone is still using MySpace], you'll hear them laughing at us.

Detailed Data

Average Sales Price

Dollar Volume

Transaction Volume

Tuesday, November 10, 2009

MRIS October 2009 Sales Report: Preliminary data

MRIS released October's data for sales of existing homes in the District today. Prices continue to fall while more units are sold. Key points [YoY]:

  • Dollar volume up 17.02%
  • Average price is down 16.76%, median is down 3.66%
  • Unit sales volume [aggregate] is up 40.58%
  • Home unit sales up 45.88%
  • Condo unit sales up 33.87%

Sales prices were 93.36% of list. At October's sales pace, there is a 6.11 month supply of condos [an increase from September] and 5.27 month supply of homes listed for sale [less than September].

Analysis forthcoming.

Monday, November 09, 2009

Wednesday, October 28, 2009

S&P/Case-Shiller: August 2009 report

The S&P/Case-Shiller Home Price Indices report for August 2009 was released yesterday. The report show "that the annual rate of decline of the 10-City and 20-City Composites improved compared to last month’s [July] reading. This marks approximately seven months of improved readings in these statistics, beginning in early 2009."

“Broadly speaking, the rate of annual decline in home price values continues to improve” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “The two Composites and 19 of the 20 metro areas showed an improvement in the annual rates of return, as seen through a moderation in their annual declines. Looking at the monthly data, 17 of the MSAs and both Composites saw price increases in August over July. While many of the markets remain down versus this time last year, the relative rate of decline has shown some real improvement."

But there is a caveat.

"Once again, however, we do want to remind people of the upcoming expiration of the Federal First-Time Buyer’s Tax Credit in November and anticipated higher unemployment rates through year-end. Both may have a dampening effect on home prices.”

YoY, DC area prices are 8.22% lower, with prices increasing 1.43% July to August.

The charts below reflect home price data for the Washington, DC MSA.



Tuesday, October 27, 2009

Repeat after me...

I've begun processing August's sales data. Based on what I've seen so far, I must ask the District government to repeat after me: it's TODD Place NE, not TOOD Place NE.

Thank you. You may now resume awarding contracts to our mayor's fraternity brothers.

Tuesday, October 20, 2009

MRIS September 2009 Housing Report

MRIS released its data for September signed sales contracts for existing home and condos in the District a few days ago. As in its August [and July and June and May] report, sales and dollar volume are up and prices are lower than the same period last year. More is selling, but for less. Plus ├ža change... Before we get excited and go shopping, remember that we're now into the one year anniversary of the financial collapse kindly brought to us by the Bagatelle brunching idiots who work on Wall Street. So it ain't as good as it looks.

Key points in September's data:

  • YoY, aggregate dollar volume jumped 18.56%. Condo dollar volume surged 29% and that of homes grew 11%,
  • Sales volume was robust, increasing 34.96% YoY. Condos and homes both shared in the positive growth, increasing 41.75% and 28.84%, respectively.
  • Prices continue their tale of woe. Average prices fell 12.15%. Condo prices fell 8.98%, while home prices dropped 13.82%. As in August, not a single home category experienced higher prices YoY.
  • At September's sales rate, there is a 5.35 month's supply of condo units on the market, 8.82% more than August. For homes, 6.39 months, 15.9% more.

Detailed Data

Average Sales Price

Dollar Volume


Transaction Volume

Tuesday, October 13, 2009

MRIS September 2009 Housing Report [preliminary]

MRIS released September's data for sales of existing homes in the District over the weekend. As in my District sales data, it shows that prices are falling, but volume is up. We're at the point where, at least in terms of dollar and sales volume, the metrics should be significantly higher than last year's, since we're marking the first anniversary of the financial collapse delivered to us by the Bagatelle brunching "kings" of Wall Street. Key points [YoY]:

  • Dollar volume up 18.56%
  • Average price is down 12.15%, median is down 4.7%
  • Unit sales volume [aggregate] exploded 34.96%
  • Home unit sales up 28.8%
  • Condo unit sales up a whopping 41.76%

Sales prices were 91.78% of list. At September's sales pace, there is a 5.35 month supply of condos and 6.39 month supply of homes listed for sale, slightly higher than the previous month.

Analysis forthcoming.

Thursday, October 08, 2009

District Sales: August 2009 [preliminary]

I've begun processing the District's sales data for August 2009. While I'm in the early stages, here's an early [unadjusted] peek at the data.

Tuesday, October 06, 2009

District Sales: July 2009

I've finished processing, geocoding, and uploading sales data for July 2009. The table below shows July 2009 average and median sales prices and unit volume by zip code and the percentage change from July 2008. This blog is starting to sound like "99 Bottles of Beer on the Wall" - each month's verse is the same, it's just the month that changes. Once again, sales volume up, prices down. "Sell one more, for a lower price..." I think I'll stick to my day job.

I noticed our Canadian friends have bought another property, a rowhouse near the Capitol, paying slightly more than $2.2M. I guess the toonie goes further down here now.

State of the Market

In July the District recorded 760 residential sales. Overall, prices were down, sales volume was up. District-wide, average sales price fell 9.93% and the median sales price fell 10.2%. Unit sales were up 8.57%. The condo market suffered a 1.48% increase in unit sales and dollar volume declined 8.21%. The number of homes sold grew a healthy 15.19% and dollar volume was up a slight 1.58%. However, average and median sales prices for homes fell sharply, down 11.82% and down 19.57%, respectively. By my estimation, foreclosures accounted for 68 of the recorded sales, about 8.9% of sales.

All but two Wards saw declines in average and median prices; two (Wards 3 and 6) had positive price growth. Despite that, all but three had an increase in unit sales.

Condo sales ruled Wards 1 and 2, constituting 74.49% and 78.57% of units sold, respectively.

Almost all neighborhoods saw declines in average and median prices.

Distribution of Sales

The chart below shows the distribution of July's recorded sales by sales price.

Detailed Data

Sales by Neighborhood

Category by Zip Code


Category by Ward

Disclaimer:

  • Unlike MRIS, my data and analyses include new units [primarily condos] so there will be some differences in my conclusions about the market's state compared to a similar analysis based solely on MRIS reports, which only report sales of existing units sold and/or listed by real estate agents.
  • This analysis is of sales recorded by the District during the month as opposed to sales settled in the month, which is what MRIS reports, so there may be some discrepancies because of timing issues. However, I believe the data do provide a helpful indicator of trends in the District.
  • Sales may have been recorded by the District's Recorder of Deed during the month yet may not appear in the District's real property sales database, my data source, many months later. Consequently, those sales will not be in the month's analysis.
  • My analysis is based on District sales and appraisal data that I've collected and processed. I've deleted those sales that appear to be of questionable data quality. Errors are always possible.
  • My analysis is limited to condos and single family homes; I omit properties the District classifies as multifamily conversions. I'm sure I'm excluding some properties that are legitimate single family homes, but I want to eliminate uncertainty.

Thursday, October 01, 2009

S&P/Case-Shiller: July 2009 report

The S&P/Case-Shiller Home Price Indices report for July 2009 was released Tuesday. You could almost hear the champagne bottles popping all over the country, considering how the media reported it. The report show "although still negative, the annual rate of decline of the 10-City and 20-City Composites improved compared to last month’s reading."

“The rate of annual decline in home price values continues to decelerate and we now seem to be witnessing some sustained monthly increases across many of the markets” says David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s. “The two composites and all metro areas are showing an improvement in the annual rates of return, as seen through a moderation in their annual declines. Looking at the monthly data, the 10-City and 20-City Composites and 18 of the 20 metros areas increased in July. In addition, both Composites and 13 of the MSA have had at least three consecutive months of positive prints. These figures continue to support an indication of stabilization in national real estate values, but we do need to be cautious in coming months to assess whether the housing market will weather the expiration of the Federal First-Time Buyer’s Tax Credit in November, anticipated higher unemployment rates and a possible increase in foreclosures.”

The report's chart shows that nationally, home prices are back to "the autumn of 2003" level. YoY, DC area prices are 9.81% lower. While prices continue to rise in the DC area, the price increase June/July was less than that of May/June.

The charts below reflect home price data for the Washington, DC MSA.



Wednesday, September 30, 2009

District Sales: July 2009 [by neighborhood]

I've begun analyzing the District's sales data for July 2009. If all goes well, I should complete the analysis by week's end. Below is a table showing sales by District neighborhood. As usual, Old City I and Old City II dominate sales.

Monday, September 28, 2009

Thursday, September 24, 2009

District Sales: July 2009 [preliminary]

I've begun processing the District's sales data for July 2009. While I'm in the early stages, here's an early [unadjusted] peek at the data.

Thursday, September 17, 2009

MRIS Analyses: Year to date sales trends

Using MRIS's 2009 data published to date [August], I thought it'd be interesting to see the sales trends for sales of existing homes and condos in the District.

Price Trend

Generally, prices are flat to slightly negative for the year. Compared to January, August's aggregate sales prices are 5.86% lower. Condos are down 6.33% and home prices are essentially flat, down 0.7%.

Price Change

Except for three months when condo prices spiked, YoY prices are in negative territory compared to 2008.

Sales Volume

What's particularly quite striking is the significant increase in sales volume as the year progressed, which I'm sure results in no small part from the Fed's efforts to create market liquidity through its purchase of $1.45T in mortgages. Despite the surge in sales, though, prices continue to slide.