iShares Dow Jones US Real Estate (IYR)

All Comments on IYR

  • commenter
    User 109762
    Sep 29 12:10 AM
    Think Housing's Bad? You Ain't Seen Nothing Yet [view article]
    goff article..

    it looks like early 2011 we will begin a recovery in most areas of the country..

    whats interesting is looking at those city charts,a good number swing back up after late 2010-into 2011,but that chart only goes as far as 2011,and if you look at Miami,San Diego/San Fran..no upward recovery movement on prices even by 2011.

    it looks like California and florida have a long way to go for a real estate recovery.

    Those numbers are percentage drop predictions from current price levels..so while it says they expect a 19% drop in San Diego prices by 2011,thats not taking into account the price drops San diego has already had over the past 18-24 months.

    so it you figure San diego has already lost about 8-10% in it's median price over the past 18-24 months ..they expect a total of about -28% drop in median price all together in SD by 2011,again I see no upward hint of movement in SD by 2011 in that prediction chart,so who knows after 2011 if the drop will be more or if it will swing back up after 2011.     Reply
  • commenter
    jay stokes
    Sep 28 04:47 PM
    Think Housing's Bad? You Ain't Seen Nothing Yet [view article]
    Frightening stuff; actually, as a potential home buyer in San Francisco, kind of helpful. In terms of accuracy, is there any information about how predictive these futures have been? For example, what where the futures looking like in 2004? 2003? How did they match actual price gains?

    Thanks,

    Jay     Reply
  • commenter
    jbaird45
    Sep 28 02:47 PM
    Replicate The Yale Endowment With These ETFs [view article]
    Would appreciate more info. about ETF'S that benefit the individual investor.

    Thanks     Reply
  • commenter
    User 65721
    Sep 28 01:47 PM
    Replicate The Yale Endowment With These ETFs [view article]
    "Sweden" is spelled without any contiguous "e"s. Reply
  • commenter
    tlc8386
    Sep 28 11:41 AM
    Homes No Longer Affordable To the Average American [view article]
    Finally someone gets it right!!! One thing not to forget is the tax situation---out here in Southern CA we have taxes that are out of control---mello roos--very high association costs--and then the state tax--insurance is also expensive if you add in earthquake.
    It's not unheard of paying upwards of 20k in these taxes on our typical house here in CA. And a 5k a month mortgage is the norm. No wonder no one can afford to live here and foreclosures are booming out here. Everyone is taking from the homeowner!!!     Reply
  • commenter
    Fowler
    Sep 28 01:50 AM
    Think Housing's Bad? You Ain't Seen Nothing Yet [view article]
    The areas that are truly, truly vulnerable are those that have been developed based on the second home market and places like Vegas and Phoenix where developers can actually find land or lots to develop (these are always the most vulnerable areas). In the other markets where you have both jobs and great school systems, say Mill Valley or Atherton in NorCal, Sudbury or Brookline outside Boston or Manhattan Beach in SoCal, real houses (i.e., 4 bedrooms) are still appreciating today. In terms of this data, it is based on medians and the median numbers have to come down because the fools kept building houses as long as the street made the money available. Your best strategy is to try to find the best piece of property in the best market you can afford at a fair price and use as much leverage is you are comfortable with. If you can not afford a high quality market, buy income property and save up. Reply
  • commenter
    head
    scratcher
    Sep 27 08:18 PM
    Think Housing's Bad? You Ain't Seen Nothing Yet [view article]
    On second thoughts....
    they pay you 48x250x152=$1,824,000

    Reply
  • commenter
    head
    scratcher
    Sep 27 06:35 PM
    Think Housing's Bad? You Ain't Seen Nothing Yet [view article]
    oh, now i understand...
    1 unit = $250 * index value
    so in my example above, they pay you 0.48x250x152=$18240.
    (i'm assuming it's based on index value when future bought?)
    www.cme.com/trading/pr...     Reply
  • commenter
    head
    scratcher
    Sep 27 06:11 PM
    Think Housing's Bad? You Ain't Seen Nothing Yet [view article]
    Thought provoking article. My thoughts are that the CME real estate futures are not liquid enough to support your results. There are almost no contracts beyond 12 months. The "last price" you refer to appears to be a kind of mid-point between the ask and bid prices (does anyone know where it comes from?).
    The "window" of % change in house prices is very large that far in the future. The "ask" price for 2011 San Francisco is 185, meaning that in 2001 someone is willing to sell a future where realestate in San Francisco is %185 of its jan 2000 real estate prices. The "bid" price is 152%, meaning that someone is willing to buy a future where realestate is %152 of its jan 2000 real estate price. If the latter is accepted, and San Francisco real estate ended up being 200%, the person who sold you that future must pay the difference i.e. they pay you 48% for each unit (1 unit = $250 ?). If you really think this is a bubble, then you can buy the 185% future now and you'll be rich (because the seller must pay you bubble prices when the bubble is gone)! If you think prices will increase to 300%, you can sell some futures to the %152 clown and he'll have to give you San Francisco real-estate at half price. It'll be interesting to see what happens if the 401k's start to diversify into this area. Can you imagine rebalancing your contributions with imaginary houses based on housing futures? I guess i find it strange that we have housing futures but no underlying "house" stock we can buy and sell now. Anyway, this is half speculation because no-one is actuallying buying/selling these futures. If it really was a bubble, wouldn't people be buying the 185% futures??
    i found the following article a comprehensive assesment of deriving house prices from market data
    www.federalreserve.gov...
    and its conclusions are based on the 3 "moments" of investor expectations
    1. Where are prices going
    2. how certain are we in 1.
    3. are the housing projections skewed to the downside implying a bubble?
    The conclusions based on more concrete statistics are
    1. prices will have a modest decline
    2. volatility of future contracts are high compared to historical trends i.e. there's a lot of uncertainty
    3. They analysed the futures of home building company equities to deduce that there is not a significant skew downwards. Only a modest bubble?     Reply
  • commenter
    Geoff
    Considine
    Sep 27 02:43 PM
    My Website
    Think Housing's Bad? You Ain't Seen Nothing Yet [view article]
    Nice article. One note of caution. The current forward curve (the red lines in your charts) is often not a very good forecast when you look broadly across commodities that have futures contracts. The forward curve is the current price at which a people are currently trading those months, but for the forward curve to be a good forecast, a number of other criteria must be met. I recall that you guys have anayzed this issue--can you remind me of those results? Have you updated those?

    Reply
  • commenter
    anger
    Sep 27 12:53 PM
    Think Housing's Bad? You Ain't Seen Nothing Yet [view article]
    The only houses in Los Angeles you can get for 275,000 is a cardboard box "fixer upper" in a shooting zone. Even the crappiest of houses sell for over 300,000. This data doesn't seem accurate at all. My best "guess" is that the percentage of the fall is waaaaayyyyy off, and must go much lower than you've predicted. Reply
  • commenter
    Robin
    Sep 27 11:34 AM
    Think Housing's Bad? You Ain't Seen Nothing Yet [view article]
    Just wait 'til the Reality of Peak Oil arrives. Parts of it are here already.

    The American Dream of suburbia never was sustainable for more than a few generations

    Cities will see the largest loss in value, and suburbia will be next to worthless.

    Either deal with Reality, or Reality will deal with you.     Reply
  • commenter
    Yev
    Sep 27 10:17 AM
    Think Housing's Bad? You Ain't Seen Nothing Yet [view article]
    I am sorry, but a 15% decline in Los Angeles? Whomever came up with this number needs to get out more. LA market is one of the most unaffordable, even a 15% drop would keep it unaffordable based on the average income in this city. Last 2 years have been financed mostly by no-down, no-doc, stated income, option ARM loans. LA will be down 30-50% conservatively, if not than people here will be living not just on negative savings but they will be borrowing using their friends credit. Reply
  • commenter
    daskol
    Sep 26 11:26 PM
    Homes No Longer Affordable To the Average American [view article]
    Powerful graph. It shows something else in addition to the incredible run-up in real housing prices of the last few years. It shows that the last time there was a crash in housing prices towards the upper-end of the spectrum you predict was the Great Depression.

    So, the argument that a housing decline of the historical significance that you predict, well, it might not appear without a widespread economic crash--is it really laughable based on this graph?

    Reply
  • commenter
    daskol
    Sep 26 11:26 PM
    Homes No Longer Affordable To the Average American [view article]
    Powerful graph. It shows something else in addition to the incredible run-up in real housing prices of the last few years. It shows that the last time there was a crash in housing prices towards the upper-end of the spectrum you predict was the Great Depression.

    So, the argument that a housing decline of the historical significance that you predict, well, it might not appear without a widespread economic crash--is it really laughable based on this graph?

    Reply
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