USA Today has an article about home price futures, which will be traded on the Chicago Mercantile Exchange starting April of next year. This is of course great news to us bubblers, in theory anyway—but as the article points out, the market won’t go anywhere unless there are enough people to take both sides of the trade.
Specifically, my concern is this: if someone is bullish on San Diego housing, he or she will likely buy a house in San Diego, not a futures contract. Whereas housing bears can only buy futures. So it seems that the market might be either illiquid, unbalanced, or both. Nonetheless, if there is sufficient interest on both sides of the trade this could be a great opportunity.