gdp's Comments

Altos Research: How's The Market? : Real Estate Shadow Demand Outweighs its Shadow Inventory

Mon, 25 Mar 2013 19:16:02 +0000

One of the things we like about our data is that it leads the headlines by 3-6 months. My very first blog post for Altos in October 2005, before we even launched the company was about San Jose prices turning flat for the first time in years! At the time, we had much shorter history, and I had much less confidence in what we were seeing, so I didn't crow as loudly. We've now had seven years of leading the headlines by 3-6 months. We get to call the inflection points before anyone else does. Right now, the market happens to be up. It's been up for over a year, so the headlines happen to be saying similar things as the real-time data.

Altos Research: How's The Market? : Real Estate Shadow Demand Outweighs its Shadow Inventory

Sat, 23 Mar 2013 20:47:53 +0000

Hi Jim - don't confuse my posts illustrating the actual facts of the current housing market with cheerleading for US housing policy! Tim - Don't confuse me reporting the fact that the market is hot that I give a damn about whether you should buy or sell. I'm not at all interested in motivating home buying. I'm personally thinking of selling. And of course I concur that future demographic shifts will impact the market in the future. This post is merely an explanation of what's happening right now. Jim and Tim - I'm interested in measuring the actual conditions. The actual conditions happen to be on fire. None of this is reported anywhere as good or bad. It just is. If the market were tanking then my articles would be about that. I have 7 years of blog posts and speeches titled things like "It's worse than you think" to prove it!

Altos Research: How's The Market? : Real Estate Shadow Demand Outweighs its Shadow Inventory

Fri, 22 Mar 2013 16:42:48 +0000

Oh and I'm usually so careful with my punctuation!

Altos Research: How's The Market? : Three Reasons Why Housing Inventory is So Low

Tue, 26 Feb 2013 00:48:23 +0000

Hi Andy - we do indeed track a million rentals every week too. Fascinatingly, rental demand is as strong as purchase demand. The supply changes haven't been as dramatic, but it turns out that "housing" demand in general is the driver. Look at any hot housing market and I'll show you a hot rental market. Topic for another post!

Altos Research: How's The Market? : Why is Housing Inventory So Darn Low?

Tue, 24 Jul 2012 18:39:05 +0000

Hi Rob - That comment is based on the data that shows inventory is low. Obviously we're seeing no big flood of shadow inventory. The hypothesis that it's related to improving market conditions is my take on the cause of low inventory. We've seen over time a compelling correlation of improving conditions (measured by what we call "psychological indicators", like Days on Market) and a declining rate of new defaults. That is, it's pretty obvious in the data that people default more when the market is ugly than they do in an improving market - even when their LTV is the same! So that's the foundation for the observations here. I haven't spent the time to do any detailed academic-style work on the topic. I just get to bloviate on the blog ;-)

Altos Research: How's The Market? : New WordPress Plugin: Charts, Regional Charts and Stats Tables, Oh my!

Tue, 28 Feb 2012 17:50:24 +0000

It sure is!

Altos Research: How's The Market? : Forbes 500 Most Expensive Zip Codes

Tue, 8 Nov 2011 20:41:07 +0000

Hi Madhaus - that's great detailed work!�

I can't speak to formatting errors or presentation decisions in the Forbes piece, but I can answer a few of the specific questions for you.�

Yes there were methodology changes year to year. We try to capture the most representative markets and have to establish some guidelines for doing so. We'll certainly change approach If we think we can get a better view. It's not an exact science. For example as you point out, condo pricing is a big factor in this output, potentially bigger than years past. What does it actually mean to have a blended average across property types anyway? It's one way to look at a market, though I personally prefer to keep property types distinct.�

For this piece we try to control for small markets. All the rankings on this list are based on active inventory not closed transactions. We had a minimum threshold of homes for sale in a 90-day rolling average. We did not count transactions.�

Ultimately, this type of piece is not academic work, it's designed to inform and entertain and create some conversation. I think the Forbes folks were quite successful on this front.�

Thanks again for the interesting take on it. Good luck with your site!

M

Altos Research: How's The Market? : The History of Good News

Thu, 30 Jun 2011 17:44:31 +0000

Always nuanced, ain't it, Ed? ;-) Interestingly, the math in your example shows why good housing data uses median pricing rather than average (mean). In your scenario, the median price is $300k all the way through. So, no, prices didn't rise.

Altos Research: How's The Market? : How to Interpret Today's S&P Case Shiller Home Price Report

Wed, 1 Jun 2011 22:25:00 +0000

You bet, Troy. We couldn't agree more. Thats precisely what our clients pay us for. Local, real time data and the apps to understand what is actually happening out there.

Altos Research: How's The Market? : Foreclosure Moratorium: A Very Bad Mistake

Wed, 6 Oct 2010 22:29:24 +0000

oops. of course you're right. I've updated the post thanks.

Altos Research: How's The Market? : Foreclosure Moratorium: A Very Bad Mistake

Wed, 6 Oct 2010 19:13:13 +0000

Hi Michael - I think you misread the post. I never said the ONLY solution is to kick people out of their homes. There are options for people in temporary situations. As I mentioned, loan mods, short sales, etc. are indeed valid options. No one is saying don't do those. Rather, I'm pointing out the unintended consequence of removing foreclosure as an option for resolving these situations. Think about the moral hazard caused when an underwater, delinquent homeowner says, "I can try to renegotiate this loan for lower payments and STILL be $150,000 in the red. Or what's going to happen? If they can't foreclose, then nothing is going to happen. I will live in my house without paying anything." or walk away and let someone else deal with it. Foreclosure, while scary and horrible for the people going through it, is a vital part of the resolution. Like it or not, it has to happen - to some. A moratorium only delays the inevitable.

Paul Kedrosky: Infectious Greed : Readings: Debt, Oil, Drought, Amazon, Usain Bolt, Housing, etc.

Sun, 1 Aug 2010 17:04:24 +0000

Nice juxtaposition of Bolt's "astonishingly" unlikely performance and the Tour's reversion of 20 years of astonishingly unlikely performance. Let's just drop the pretense, shall we?

Altos Research: How's The Market? : Breaking news?

Tue, 25 May 2010 17:39:31 +0000

That's right Osman. The Case Shiller is a useful number. We just like to point out that there is lots of data that leads the Case Shiller, and it's so highly correlated that you don't need to be surprised by the CS headlines.

Altos Research: How's The Market? : Year-End 2009 Trends: The Northeast (New York, Boston, Philadelphia & Washington DC

Sat, 23 Jan 2010 20:23:29 +0000

Hi Louis - the scientific answer is "probably 10 years worth." ;-)

Altos Research: How's The Market? : Why "Affordability" Doesn't Dictate Home Prices

Wed, 16 Dec 2009 23:53:32 +0000

Nathan - that is the dramatically lower inventory. A big deal in phx this year.

Altos Research: How's The Market? : New sharing options for your AltosCharts

Fri, 4 Dec 2009 23:47:15 +0000

Sheesh. Give 'em an inch, they ask for a mile ;-)

Paul Kedrosky: Infectious Greed : Diversions: Deer Roadkill by U.S. State

Mon, 28 Sep 2009 16:31:02 +0000

would love to see this data plotted over time. it'd really illustrate the deer population explosion over the last 30 years. Suburban Chicago has something like 10x the deer it did in the 80s. Huge pest problem - if charismatic megafauna are ever noted as pests.

Paul Kedrosky: Infectious Greed : Pessimism Porn: The New Depression

Thu, 12 Feb 2009 21:24:57 +0000

Marxism Today. Awesome. I need that on my coffee table.

Paul Kedrosky: Infectious Greed : Be It Resolved: Americans are Spenders

Sat, 3 Jan 2009 20:24:21 +0000

it seems to me that people simply put money where they are incented to. In the past 15 years Americans saw wealth increase more and taxed less via capital gains, whether those gains are housing, entrepreneurial, or the nasdaq. They just happened to be options not tracked by the "savings rate". The Japanese didn't have any of those options, so they put their cash in a bank and earned 0.5%. As those options are gone, I expect you'll see more traditional savings by Americans too.

Paul Kedrosky: Infectious Greed : For Sale: Olympic Ski Resort. Mtn/Lake Views. Motivated Seller.

Wed, 22 Oct 2008 13:41:12 +0000

funny thing about the ski business. It's actually the real estate business. No one makes money on skiing, they make (made) money on condos. Nuff said.