Housing Price Trends Posts 2Q2021 Results

Housing Price Trends has updated the price charts with 1Q2021 Housing Price Index data. For this quarter, there were 40 BUY signals and 5 SELL signals. There were 11 BUY signals and 1 SELL signal (Binghamton, NY) in the top 148 cities in which to invest, and 29 BUY signals & 4 SELL signals other than in the top 148 cities. Remember the BUY signals that occur outside of the top 148 cities are not as meaningful, since those cities have prices that generally go up and down on much smaller amounts.

The volume of BUY signals in the top 148 cities is only slightly less than the  previous quarter. Adding the last 2 quarters together, there were 95 BUY signals out of 148 cities. Obviously, the housing market is in unusual territory. The big question is "will we see a large number of SELL signals in the near future?" We live in volatile times. When you get SELL signals, you normally have some time to actually sell, since these signals usually trigger BEFORE prices actually fall. The Housing Price Trends system detects a change in price momentum; that's when prices increases slow down enough to matter, often before prices start declining.

If you buy during these times, you should not be surprised that your hold period is somewhat shorter than the past history. There are certainly still massive opportunities in the housing market; just add more caution to your investing.

 

Housing Price Trends Posts 1Q2021 Results

Housing Price Trends has updated the price charts with 1Q2021 Housing Price Index data. For this quarter, there were 45 BUY signals and no SELL signals. There were 19 BUY signals in the top 148 cities in which to invest, and 26 BUY signals other than in the top 148 cities. Remember the BUY signals that occur outside of the top 148 cities are not as meaningful, since those cities have prices that generally go up and down on much smaller amounts.

This is an extraordinary number of BUY signals. But we all know the housing market is affected by extraordinary conditions. Some of those influencing conditions are rent moratorium, stimulus money, building material prices and migration patterns. We will have to see if the rent moratorium actually ends at the end of June. It may not take much to pop this bubble: a raise in interest rates could be a start (1% rise in interest rates could drop prices by 10%).

 

 

Housing Price Trends Posts 4Q2020 Results

Housing Price Trends has updated the price charts with 4Q2020 Housing Price Index data. For this quarter, there were 25 BUY signals and no SELL signals. There were 9 BUY signals in the top 148 cities in which to invest, and 16 BUY signals other than in the top 148 cities. Remember the BUY signals that occur outside of the top 148 cities are not as meaningful, since those cities have prices that generally go up and down on much smaller amounts.

This is the highest number of BUY signals in the top 148 than we have seen in a few years.

As the end of some government housing assistance programs approaches, and with the uncertainty of future programs, the housing market could be in for some future turmoil. It would be wise not to read too much into the high number of BUY signals, as the unusual economic conditions, job uncertainty and uncertainty in future interest rates all create more than normal pressures on the housing market.

 

 

 

 

The one chart that tells you all you need to know!

If you are not yet convinced that a long-term hold of residential property may not be the best investment, then this chart should convince you. This is the chart of the overall US Housing Price Index, adjusted for inflation. The dashed line is the linear trend line for the chart period. Over a 45 year period, the inflation-adjusted HPI went up 155%, or 3.4% per year. And that's using the "official" CPI data; and we know the Bureau of Labor Statistics constantly adjusts how they calculate the CPI (i.e., to keep it at a low number), so that the 3.4% annual return could actually be 0%.

For that same period the CPI went up 490%, which diminished the 758% increase of the HPI.

Excellent inflation-adjusted returns can be achieved in residential real estate, but you have to know when to BUY, in WHICH market, and when to SELL.

MORE ABOUT CPI:

While the official CPI published by the government is constantly manipulated to keep it low, the real-world CPI is higher. One source does this alternative calculation and comes up with a CPI about 2-3X the official CPI (http://www.shadowstats.com/alternate_data/inflation-charts):

As you can see from this chart, this divergence started around 1980.

Housing Price Trends Posts 2Q2020 Results

Housing Price Trends has updated the Standard price chart data with 2Q2020 housing price data. For this quarter, there were 10 BUY signals and 3 SELL signals. However, only 2 BUY signals (Binghamton, NY and Yuma, AZ) occurred in the top 148 cities in which to invest, and 1 of the 3 SELL signals occurred in the top 148 cities (Midland, TX). Remember the BUY signals that occur outside of the top 148 cities are not as meaningful, since those cities have prices that generally go up and down on much smaller amounts.

The inflation-adjusted annual appreciation for Midland, TX was 11.5% for a 1.75 year hold. This period was not as profitable as previous periods identified by HPT: 47% and 20% per year. Also, Midland, TX is ranked #94 of 148 top cities.

The 3Q2020 and beyond should be interesting times for real estate due to the COVID-19 situation. Expect more volatility in the real estate market! A lot will depend on government relief that may help homeowners, and COVID-19 issues.

Housing Price Trends Posts 1Q2020 Results

Housing Price Trends has updated the Standard price chart data with 1Q2020 housing price data. For this quarter, there were 9 BUY signals and 10 SELL signals. However, only 1 BUY signal (Myrtle Beach-Conway-North Myrtle Beach, SC-NC) occurred in the top 148 cities in which to invest, and 4 of the 10 SELL signals occurred in the top 148 cities. Remember the BUY signals that occur outside of the top 148 cities is not as meaningful, since those cities have prices that generally go up and down on much smaller amounts.

The 2Q2020 and beyond should be interesting times for real estate due to the COVID-19 situation. Expect more volatility in the real estate market!

Housing Price Trends Posts 2Q2019 Results

Housing Price Trends has updated the Standard price chart data with 2Q2019 housing price data. For this quarter, there were 10 BUY signals and 14 SELL signals. However, no BUY signals occurred in the top 148 cities in which to invest, and 12 of the 14 SELL signals occurred in the top 148 cities. This compares to the following for 4Q2018: 3 BUY signals and 1 SELL signals. This is an enormous jump in the number of SELL signals in the top 148 cities. Remember the BUY signals that occur outside of the top 148 cities is not as meaningful, since those cities have prices that generally go up and down on much smaller amounts.

Of the 12 SELL signals in the top 148 cities, 9 were in California. Those cities were Anaheim-Santa Ana-Irvine, Oakland-Berkeley-Livermore, Oxnard-Thousand Oaks-Ventura, San Diego-Chula Vista-Carlsbad, San Francisco-San Mateo-Redwood City, San Jose-Sunnyvale-Santa Clara, San Luis Obispo-Paso Robles, Santa Maria-Santa Barbara, and Santa Rosa-Petaluma.

 

This quarter we feature the Santa Rosa-Petaluma, CA chart. This city had a SELL signal this quarter. If you had sold on this signal you would have attained a 29.3% annual return, adjusted for inflation on a 25% down payment purchase. If you had followed the Housing Price Trends System, you would have attained 42.0% annual return for the 1Q1988-1Q1991 period and 48.2% for the 3Q1999-4Q2006 period. That is profitable way to invest in real estate. Your profits using the Housing Price Trends System are exponentially greater than holding real estate for a small cash flow.

Housing Price Trends, using our proprietary BUY and SELL signals, helps protect you from downturns in the market, and captures optimal appreciation periods.