Top tier SD RE has dropped 5.8% from peak . . . overall SD RE dopped 9.4%

[schizo2buyORnot]

Per Case-Shiller here:
http://www2.standardandpoors.com/portal/site/sp/en/us/page.topic/indices_csmahp/0,0,0,0,0,0,0,0,0,1,1,0,0,0,0,0.html

The top 1/3 of homes in SD (homes over 678K) have dropped 5.8% from the market peak of June, 2006 (index value of 224.43). AS of August, 2007 the index was at 226.73 a drop of 5.8%

Middle 1/3 (482K to 678K) = 10.2% drop (high of 254.56 in November, 2005 to 225.89 in August, 2007)

Bottom 1/3 (below 482K) = 13.3% drop (high of 296.86 in June, 2006 to 257.24 in August, 2007).

Overall SD RE = 9.4% drop (high of 250.34 in November, 2005 to 226.73 in August, 2007)

Caveat: As always the Case Shiller data lags and this data does not reflect the sub-prime carnage of late. It will be very interesting to see the data of the next few months.

No wonder my frustration has mounted. All of the homes in the areas I am looking to buy in would be in the top tier.

[drunkle]

i want to know what’s with the weird breakdown:

Middle 1/3 (482K to 678K)

like, there are homes that broke through the low and up into the middle, but will fall back down. likewise, the plethora of middle homes that are deep into high territory yet.

i’m assuming that the breaks are according to the actual number of homes vs price, but… matter of fact, how they did their analysis at all is confusing. how do you track price changes when price is part of your categorization?

maybe if they had made the spreads strictly by price spread regardless of number of homes at a particular price point, would be easier to visualize…

[Rich Toscano]

Drunkle – The price breakpoints are as of August 2007. It means that a given home’s category was determined as of that date (either by the sale price if it sold in Aug 2007, or the imputed price based on the HPI), and it will never jump categories regardless of where its price goes.

The problem you describe, of a home jumping categories, would happen if they were measuring median price or something. But they can avoid it because they are comparing same-home sales, so they can “pin” a given home into one category even if the price changes.

In retrospect, I’ll bet there was a much better way to explain that. 🙂

Rich

PS – As for the weird breakpoints, I assume they are just using a distribution of some sort so that there are an equal number of homes in the hi and low categories, or something.

PPS – All of the above is speculation on my part. But I’ll bet it’s true.

[Fearful]

they can “pin” a given home into one category even if the price changes

Presumably the categorizations are based on the last sale price of the house.

[Fearful]

they can “pin” a given home into one category even if the price changes

Presumably the categorizations are based on the last sale price of the house.

[Fearful]

they can “pin” a given home into one category even if the price changes

Presumably the categorizations are based on the last sale price of the house.

[Fearful]

they can “pin” a given home into one category even if the price changes

Presumably the categorizations are based on the last sale price of the house.

[drunkle]

thanks rich. your explanation clears things up a bit, particularly the fact that they’re using same home sales.

as for the distribution curve, i agree that that’s probably what they’re doing. it’s just weird and seems inaccurate or at least skewed. to have such large price spreads in the low and high end, particularly at the high end, would seem to dilute the data.

edit: rather, instead of dilute the data, dilute the results…

[drunkle]

thanks rich. your explanation clears things up a bit, particularly the fact that they’re using same home sales.

as for the distribution curve, i agree that that’s probably what they’re doing. it’s just weird and seems inaccurate or at least skewed. to have such large price spreads in the low and high end, particularly at the high end, would seem to dilute the data.

edit: rather, instead of dilute the data, dilute the results…

[drunkle]

thanks rich. your explanation clears things up a bit, particularly the fact that they’re using same home sales.

as for the distribution curve, i agree that that’s probably what they’re doing. it’s just weird and seems inaccurate or at least skewed. to have such large price spreads in the low and high end, particularly at the high end, would seem to dilute the data.

edit: rather, instead of dilute the data, dilute the results…

[drunkle]

thanks rich. your explanation clears things up a bit, particularly the fact that they’re using same home sales.

as for the distribution curve, i agree that that’s probably what they’re doing. it’s just weird and seems inaccurate or at least skewed. to have such large price spreads in the low and high end, particularly at the high end, would seem to dilute the data.

edit: rather, instead of dilute the data, dilute the results…

[Rich Toscano]

Drunkle – The price breakpoints are as of August 2007. It means that a given home’s category was determined as of that date (either by the sale price if it sold in Aug 2007, or the imputed price based on the HPI), and it will never jump categories regardless of where its price goes.

The problem you describe, of a home jumping categories, would happen if they were measuring median price or something. But they can avoid it because they are comparing same-home sales, so they can “pin” a given home into one category even if the price changes.

In retrospect, I’ll bet there was a much better way to explain that. 🙂

Rich

PS – As for the weird breakpoints, I assume they are just using a distribution of some sort so that there are an equal number of homes in the hi and low categories, or something.

PPS – All of the above is speculation on my part. But I’ll bet it’s true.

[Rich Toscano]

Drunkle – The price breakpoints are as of August 2007. It means that a given home’s category was determined as of that date (either by the sale price if it sold in Aug 2007, or the imputed price based on the HPI), and it will never jump categories regardless of where its price goes.

The problem you describe, of a home jumping categories, would happen if they were measuring median price or something. But they can avoid it because they are comparing same-home sales, so they can “pin” a given home into one category even if the price changes.

In retrospect, I’ll bet there was a much better way to explain that. 🙂

Rich

PS – As for the weird breakpoints, I assume they are just using a distribution of some sort so that there are an equal number of homes in the hi and low categories, or something.

PPS – All of the above is speculation on my part. But I’ll bet it’s true.

[Rich Toscano]

Drunkle – The price breakpoints are as of August 2007. It means that a given home’s category was determined as of that date (either by the sale price if it sold in Aug 2007, or the imputed price based on the HPI), and it will never jump categories regardless of where its price goes.

The problem you describe, of a home jumping categories, would happen if they were measuring median price or something. But they can avoid it because they are comparing same-home sales, so they can “pin” a given home into one category even if the price changes.

In retrospect, I’ll bet there was a much better way to explain that. 🙂

Rich

PS – As for the weird breakpoints, I assume they are just using a distribution of some sort so that there are an equal number of homes in the hi and low categories, or something.

PPS – All of the above is speculation on my part. But I’ll bet it’s true.

[raptorduck]

The index uses sales pairs, two actual sales of the same home over time.

[raptorduck]

The index uses sales pairs, two actual sales of the same home over time.

[raptorduck]

The index uses sales pairs, two actual sales of the same home over time.

[raptorduck]

The index uses sales pairs, two actual sales of the same home over time.

[drunkle]

i want to know what’s with the weird breakdown:

Middle 1/3 (482K to 678K)

like, there are homes that broke through the low and up into the middle, but will fall back down. likewise, the plethora of middle homes that are deep into high territory yet.

i’m assuming that the breaks are according to the actual number of homes vs price, but… matter of fact, how they did their analysis at all is confusing. how do you track price changes when price is part of your categorization?

maybe if they had made the spreads strictly by price spread regardless of number of homes at a particular price point, would be easier to visualize…

[drunkle]

i want to know what’s with the weird breakdown:

Middle 1/3 (482K to 678K)

like, there are homes that broke through the low and up into the middle, but will fall back down. likewise, the plethora of middle homes that are deep into high territory yet.

i’m assuming that the breaks are according to the actual number of homes vs price, but… matter of fact, how they did their analysis at all is confusing. how do you track price changes when price is part of your categorization?

maybe if they had made the spreads strictly by price spread regardless of number of homes at a particular price point, would be easier to visualize…

[drunkle]

i want to know what’s with the weird breakdown:

Middle 1/3 (482K to 678K)

like, there are homes that broke through the low and up into the middle, but will fall back down. likewise, the plethora of middle homes that are deep into high territory yet.

i’m assuming that the breaks are according to the actual number of homes vs price, but… matter of fact, how they did their analysis at all is confusing. how do you track price changes when price is part of your categorization?

maybe if they had made the spreads strictly by price spread regardless of number of homes at a particular price point, would be easier to visualize…

[greensd]

And remember, the percentages will be a lot smaller on the way down. The lower tier went up 200%, but would only have to go down 66% to get back where it started, ignoring inflation. If you take inflation into account, we’re even closer to 2001 prices.

Just tracking the segment boundaries could be interesting. When the bottom of the middle third hits $400,000, maybe I’ll start looking around.

[greensd]

And remember, the percentages will be a lot smaller on the way down. The lower tier went up 200%, but would only have to go down 66% to get back where it started, ignoring inflation. If you take inflation into account, we’re even closer to 2001 prices.

Just tracking the segment boundaries could be interesting. When the bottom of the middle third hits $400,000, maybe I’ll start looking around.

[greensd]

And remember, the percentages will be a lot smaller on the way down. The lower tier went up 200%, but would only have to go down 66% to get back where it started, ignoring inflation. If you take inflation into account, we’re even closer to 2001 prices.

Just tracking the segment boundaries could be interesting. When the bottom of the middle third hits $400,000, maybe I’ll start looking around.

[greensd]

And remember, the percentages will be a lot smaller on the way down. The lower tier went up 200%, but would only have to go down 66% to get back where it started, ignoring inflation. If you take inflation into account, we’re even closer to 2001 prices.

Just tracking the segment boundaries could be interesting. When the bottom of the middle third hits $400,000, maybe I’ll start looking around.

[schizo2buyORnot]

Prices in the top 1/3 are now at March, 2005 prices.

Minor Correction . . .

The top 1/3 . . . As of Aug, 07 index # is at 211.48 (not 226.73) for a drop of 5.8%

The original post in referring to the top 1/3 of market erroneously had the Aug, 07 index # (226.73) which is the # for the ENTIRE SD market, not the top 1/3 index # (211.48). The 5.8% total drop was and is correct.

In search of a crystal ball . . . .

[schizo2buyORnot]

Prices in the top 1/3 are now at March, 2005 prices.

Minor Correction . . .

The top 1/3 . . . As of Aug, 07 index # is at 211.48 (not 226.73) for a drop of 5.8%

The original post in referring to the top 1/3 of market erroneously had the Aug, 07 index # (226.73) which is the # for the ENTIRE SD market, not the top 1/3 index # (211.48). The 5.8% total drop was and is correct.

In search of a crystal ball . . . .

[schizo2buyORnot]

Prices in the top 1/3 are now at March, 2005 prices.

Minor Correction . . .

The top 1/3 . . . As of Aug, 07 index # is at 211.48 (not 226.73) for a drop of 5.8%

The original post in referring to the top 1/3 of market erroneously had the Aug, 07 index # (226.73) which is the # for the ENTIRE SD market, not the top 1/3 index # (211.48). The 5.8% total drop was and is correct.

In search of a crystal ball . . . .

[schizo2buyORnot]

Prices in the top 1/3 are now at March, 2005 prices.

Minor Correction . . .

The top 1/3 . . . As of Aug, 07 index # is at 211.48 (not 226.73) for a drop of 5.8%

The original post in referring to the top 1/3 of market erroneously had the Aug, 07 index # (226.73) which is the # for the ENTIRE SD market, not the top 1/3 index # (211.48). The 5.8% total drop was and is correct.

In search of a crystal ball . . . .

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