Case-Shiller from 3 months into the future

Monday, June 16, 2008

Bay Area

"880": Pleasanton, Dublin, San Ramon, Walnut Creek, Pleasant Hill
"SE": Fremont, Milpitas, northernmost San Jose

"Ghetto" zip codes (e.g. Concord, Union City) are excluded.

Trulia's resale database is very limited, so 3 month resolution with a lot of noise is the best I can do. I planned to add a series for SW (Cupertino, Palo Alto & such) but there was not enough data, and the resulting chart was too erratic. It does appear that southwest Bay Area is still stuck at 2005 pricing.

Tuesday, June 10, 2008

Three suburbs

I looked and looked at today's post on BMIT and in the end I decided that it could use some hard HPI data.

And here it is.

I basically took HPI profiles for three suburbs and scaled them using known sale prices of those three houses.

Some thoughts. (Read the original post to understand what's going on)

The Temecula house is slightly above median for Temecula-Murrieta area, and it's the nicest of all three. Notice the 10k sf lot and the fact that it has no HOA or Mello-Roos. It is aggressively priced and should not have much trouble selling.

The 4S house is well below median for 4S. It's an 'economy' house. In 4S Ranch and Carmel Valley, everyone and their mother has 3000 sq.ft., and that's not the factor that determines value of the house. The key factor is lot size. BMIT post incorrectly says that 17004 Ralphs Ranch Rd. has 8276 sq.ft. lot. 'Economy' 4S houses never have lots that big. It's really 5300 sf. There may be something wrong with interior and upgrades. Here's a good example of a 'median' 4S house:

15161 Cross Stone Dr, San Diego CA 92127

4 beds, 2.5 baths, 3,031 sq ft, 6,720 sf. Sold for $812,500 on 03/20/2008. 17004 Ralphs Ranch was already listed, and the buyer of 15161 Cross Stone surely must have looked at it before committing to pay 130K more for a different house.

The CV house is below median (it's also on a postage stamp lot). At 920k, it's somewhat overpriced. In today's market, it would have a better chance of selling at 860k.

If CV and 4S were deflated to the same level as Temecula, 17004 Ralphs Ranch would be worth 500k, and 13854 Kerry would be worth 650k.

Sunday, June 8, 2008

Temecula & Murrieta

This was on my back burner for a long time. There's no equivalent of SDLookup or San Diego County Real Estate Information in Riverside County (as far as I know), so it's harder to get the data. In the end I went with Trulia - they have about 9 months' worth of complete sales records and historical data for everything sold during this 9 month window.

As of May '08, Temecula and Murrieta are 40% off the peak, with no indications of slowing down.

Friday, June 6, 2008

SDHPI vs. Case-Shiller

Case-Shiller is shifted back one month: the most recent point ("March 2008", published May 25) is plotted in February on the chart.

The agreement seems to be quite good, SDHPI is a bit more "bearish" than C-S, possibly because C-S assigns higher weights to expensive houses and SDHPI weighs everyone equally.

Even better agreement in low and middle tiers, clear discrepancy in the high tier. It's mainly because SDHPI's high tier is geographical and C-S's high tier is price based. Larger properties from middle and even low SDHPI tiers occasionally end up in C-S's high tier. Clearly, price stability has more to do with geographic factors (schools, crime, demographics) than with absolute price values.

Monday, June 2, 2008


City average: 31.2% off the peak, July 2003
Top tier: 11.9% off the peak, April 2004
Middle tier: 32.5% off the peak, June 2003
Bottom tier: 39.6% off the peak, February 2003

Slight change of zone definitions: "north of 78" is defined as 92056,92057,92083,92084. San Marcos North (92069) fares slightly better and 92078 fares better yet. Escondido is very heterogeneous and "railroad tracks" do not match with zip code boundaries.