.jpg)
Below is a plot showing the individual 20 cities tracked by the Case Shiller housing index through the May '09 data released earlier this week (click on all my plots for a larger view):
I think it is important to look at individual cities as well as the overall Case Shiller composite indexes. Not only because individual cities act different and according to where you live, you may be interested in one or another. But also because some cities will be leading indicators to the overall housing market and overall Case Shiller index. As I mentioned in a previous post, I think we will see some housing markets reverse 6-9 months earlier than the overall index so that will be a good leading indicator of the bottom in the housing market.
If you look at the above plot you will see that some cities are continuing their trend downward while some seem to have really reversed course the last few months.
Which Cities' Housing Markets Are Strongest and Weakest?
Some of the strongest reversing markets are Washington D.C., San Diego, Chicago, San Fransisco, and Cleveland. I am not saying these are the strongest markets, but rather that these are reversing their trends the fastest. The weakest are Las Vegas and Miami which seem to be stuck in a freefall with little to no sign of any reversal. Here is a plot comparing the top and bottom two in terms of reversing trend:
You will see above how up until a few months ago all 4 of these cities' housing markets were falling fast but then Washington D.C. and San Fransisco really reversed course fast while Las Vegas and Miami have continued down.
It is too early to say this means the bottom for the market is coming but it is another early sign to give some optimism and adds to my recent observations on the ARIMA model for the 10-city composite. These cities (D.C. and SanFran) will be key to watch in the next 6-9 months as they may be the first to show a bonafide bottom and reversal and be a leading indicator for the U.S. housing market.
...
0 comments:
Post a Comment