“Why Isn’t My House Selling If the Market’s So Hot?!?”
If you estimate — as most Realtors do — that the mainstream media (“MSM”) lags the housing market by 3-4 months, what do you suppose the real estate headline(s) will be in early 2014?
That Buyers have become scarcer and more cautious.
That’s particularly the case north of $500k in the Twin Cities, which — if not exactly upper bracket terrain — is well beyond the purchasing power of most first-time Buyers driving this year’s housing surge.
In the meantime, many local listing agents (representing Sellers) face a credibility gap with their clients, whose expectations these days seem to be set by: a) Zillow; and b) local news headlines.
Government Shut-Down Effects, Cont.
At least in the Twin Cities, it’s hard to parse how much of the slow-down at the moment is seasonal; how much is the economy; and how much is due to general uncertainty caused by the government shut-down.
However, IF the big issue is Buyer psychology and IF the government shut-down/debt ceiling is resolved sometime soon, here’s how we’ll know: this December should be busier than normal.
In the meantime, well-qualified Buyers who are willing to step up to the plate are enjoying unaccustomed leverage.
Can you say, “best deals of the year?”
Oct. Case-Shiller Index
In light of the foregoing, you might be expecting me to be forecasting a dip in the latest Case-Shiller numbers, due to be released later this month (note: that’s now Nobel Laureate Robert Shiller).
Not so.
Closed sales are a famously lagging indicator for the housing market.
On top of that, the Case-Shiller index is reported with a two-month delay (I suppose that makes it a lagging indicator of a lagging indicator).
Prediction: More Bullish Headlines in 2 Weeks
Working your way back, August closed sales reflect deals done at the peak of this year’s market in May-June.
Bottom line?
I expect the Oct. Case-Shiller index to show continued strong appreciation — which will no doubt generate yet another round of bullish (and misleading) housing headlines.
The March 2014 Case-Shiller index will likely tell another story.
See also, “Government Shut-Down & the Housing Market.”
