The Housing Bottom Is Here

houses los angeles san fernando valley suburbs

Photo: Wikimedia Commons

Today’s Case-Shiller housing report for March was a bit of a disappointment.The headline sequential gain for the 20-city composite was just 0.09%, bit below the 0.2% that analysts had expected.

But it’s obvious: Housing is bottoming.

As S&P’s David Blitzer said on CNBC today: Housing is “a whole lot better than the headlines”

Indeed, the more you unpack the data, the clearer it gets that things are improving.

First, let’s just look at the general, YOY chance in the 20 city composite. Clearly we’re getting closer to YOY improvement.


Digging deeper, this was two straight months of sequential gains, and 13 out of the 20 cities in the index were flat or up for the month.

Remember, too, that Case-Shiller is a famously laggy index. Not only are we talking about March data here (in late May) but that March data is based on data that can be several months old.

Other more recent numbers are showing even more aggressive improvement.

According to Zillow, house prices rose 0.7% in April.

The FHFA Home Price Index showed a stunning 1.8% increase. (Todd Sullivan has written a great post about how FHFA is more reliable than Case-Shiller).

CoreLogic showed a 0.6% increase in March.

The bottom line: Every single measure out there is showing gains price gains.

You can argue that Case-Shiller is the gold standard, and that being the most conservative index, it should be given the most wait. But the preponderance of data suggests it’s undershooting.

Furthermore, other non-price housing numbers are coming in nice.

Housing starts continue to show huge year-over-year gains.


Existing home sales are also a rising (although without fireworks).

Here’s a chart of existing home sales from Scott Grannis


Photo: Calafia Beach Pundit

People have gotten tired of hearing housing-is-bottoming calls, since they’ve been wrong for the past 5 years.

But eventually the market will bottom (no, we don’t believe it’s different this time) and right now pretty much everything is pointing up.

Back in February, one of the greatest chronicles of housing Calculated Risk predicted that the bottom would come sometime in March. That appears to be right on schedule.

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