[Opinion] Research is great, but sometimes the answer can be found just outside your door


RealEstateMarketReportsBy Philip Haldiman, Editor-in-Chief | Dealmaker

(Editor’s note: Opinion pieces are published for discussions purposes only.)

Real estate research, from foreclosure to economic impact reports, can elicit a variety of responses and interpretations.

Such was the case with the S&P/Case-Shiller Home Price Index report, with one interpretation painting a favorable picture for the Phoenix housing market.

On Tuesday February 24, 2015, two stories were published in Rose Law Group Reporter regarding the S&P/Case-Shiller Home Price Index report: “Home price growth slowest in 3 years” from Wall Street Journal and “Home-price gains in 20 U.S. cities accelerated in December, including Phoenix,” from Bloomberg.

Both publications reported the home price index covering the entire nation rose 4.6 percent in the 12 months ended in December. Wall Street Journal reported this was the weakest full-year gain since home prices were falling in 2011 and the weakest pace in three years.

Not too sunny.

However, Bloomberg focused on narrower measures of home prices, particularly the seasonally adjusted home prices in the 20-city index, which includes Phoenix. This index increased 0.9 percent in December from the prior month, the biggest advance since March.

These cities appreciated at a faster pace last year, which could be a sign that a limited supply is forcing up property values in Phoenix, the article said.

Bloomberg reported wider credit availability will mean growth for builder Scottsdale-based Taylor Morrison Home Corp.

“We are excited to see incremental positive changes in the mortgage market that should continue to move the recovery forward,” said Sheryl Palmer, the company’s chief executive officer.

On the other hand, Wall Street Journal quoted David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices, as saying the housing recovery is faltering.

Again, not too sunny.

“While prices and sales of existing homes are close to normal, construction and new home sales remain weak,” he said. “The softness in housing is despite favorable conditions elsewhere in the economy: strong job growth, a declining unemployment rate, continued low interest rates and positive consumer confidence.”

A new real estate report is released practically every day, with coverage upon coverage by news organizations across the country. But most agree the Phoenix housing market has been flat.

NPR’s Marketplace was one of the many that did a story trying to make sense of the S&P/Case-Shiller study. The reporter interviewed a regular Joe on the streets of New York City who summed it up pretty well, saying he just doesn’t have the financial capabilities to buy a home right now.

That’s pretty sensible.


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February 2015