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Case-Shiller data doesn't reflect big hike in interest rates

  • Home price gains of about 1% for the month and 12% Y/Y were roughly inline with previous gains as well as expectations. However, this is a June report for home sale closings from late spring and early summer (meaning the sales contract was signed even earlier). It contains virtually no information about how home prices are reacting to the sharp jump in interest rates this summer.
  • That said, some more detail:
  • All 20 cities posted monthly and annual gains, but prices rose faster this month than last in just 6 cities as opposed to 10 in May. Dallas and Denver hit new all-time highs. San Francisco is up 47% from its March 2009 low. Phoenix is up 37% from its September 2011 low.
  • Las Vegas prices are up 24.9% Y/Y, San Francisco +24.5%, Phoenix up 19.8%, Los Angeles +19.9%. On the lower end, Cleveland +3.5%, D.C. +5.7%, Chicago +7.3%, New York +3.3%.
  • Full report.
  • Homebuilder ETFs: XHB, ITB, PKB.
Comments (5)
  • San Francisco 24.9%? That freaken place is high on helium.
    27 Aug 2013, 09:47 AM Reply Like
  • I lived there in the '80's - same thing happened then.
    27 Aug 2013, 09:56 AM Reply Like
  • Yep, you got to remember San Francisco is home to Silicon Valley, High Tech Medical, lots of major universities and money to feed them. At the same time, it is housing capacity constrained as basically everywhere that can be built within the hills which ring the Bay Area has been. The area designs and develops new products; something that rarely declines, provides good paying jobs and options for educated people and has limited housing supply.

     

    The San Francisco Bay Area is not indicative of the rest of the US.
    27 Aug 2013, 04:29 PM Reply Like
  • "San Francisco Bay Area is not indicative of the rest of the US" ...truer words have never been uttered.
    27 Aug 2013, 09:00 PM Reply Like
  • Ha! Can you imagine moving from SF to the southern part of Ohio? Bit of a culture shock for me.
    28 Aug 2013, 06:07 AM Reply Like
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