Housing Giants - February 15, 2009 - (Page 7) MARKET for a graph of total single-family permits (1996 through 2012P) There are other considerations we feel could affect the Case-Shiller results: In 2006, the sales mix shifted to subprime-type buyers who were, for the most part, purchasing less expensive homes. This resulted in: n Understated median prices, Single-Family because the volume shifted more Permits as % of Peak, 1980-2007 to cheaper homes. Overstated price appreciation on paired sales, as the cheap homes in inner cities and outlying areas experienced high appreciation rates. n for a graph of U.S. National Home Price Indices Applying this thinking means that price appreciation on non-distressed homes in the U.S. is probably somewhere between the blue and green line on our chart in the pop-up. HG John Burns Real Estate Consulting helps many of the largest companies in the industry with strategy and monitoring market conditions. You can reach John Burns at jburns@realestateconsulting.com and Lisa Marquis Jackson at lmjackson@realestateconsulting.com. * Peak activity since 1985. ** Annual Mortgage Costs + 1/7th of the downpayment divided by income Proprietary affordability scale with 0 meaning most affordable time since 1983, 5 meaning median affordability, and 10 meaning least affordable time. Data on all markets available at www.realestateconsulting.com Sources: John Burns Real Estate Consulting, Bureau of Labor Statistics, Census Bureau, through the month ending November 2008 n Case-Shiller eliminates the transaction if “the order of magnitude in values appears unrealistic.” An allocation to one of three “tiers” is made for each paired sale. Allocation to a tier is made according to first sale price (i.e., the lowest tier is the bottom third of sales prices). Lower tiers receive a lower weighting. Many of these nuances help prevent data errors in a stable market, but in today’s environment of distressed n sales, they could affect the reporting as values are dropping. The median home is now a foreclosure, which tends to be in a worse location and does not represent what you might consider to be the median home in many markets. 07 2.15.09 HOUSING GIANTS www.HousingGiants.com http://www.realestateconsulting.com http://www.HousingGiants.com
Table of Contents Feed for the Digital Edition of Housing Giants - February 15, 2009 Housing Giants - February 15, 2009 Contents Viewpoint News Market Feature Housing Giants - February 15, 2009 Housing Giants - February 15, 2009 - Housing Giants - February 15, 2009 (Page Cover1) Housing Giants - February 15, 2009 - Contents (Page 2) Housing Giants - February 15, 2009 - Viewpoint (Page 3) Housing Giants - February 15, 2009 - News (Page 4) Housing Giants - February 15, 2009 - News (Page 5) Housing Giants - February 15, 2009 - Market (Page 6) Housing Giants - February 15, 2009 - Market (Page 7) Housing Giants - February 15, 2009 - Feature (Page 8) Housing Giants - February 15, 2009 - Feature (Page 9) Housing Giants - February 15, 2009 - Feature (Page 10) Housing Giants - February 15, 2009 - Feature (Page 11) Housing Giants - February 15, 2009 - Feature (Page 12) Housing Giants - February 15, 2009 - Feature (Page 13)
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