Real Estate Decoded -

Featured May 21, 2022

The Volatility Mismatch Theory of Housing Supply and Demand, and House Price Instability

It doesn’t take large increases in the demand for houses to outrun the naturally extremely slow increases in the total supply of houses, and when that happens, prices can skyrocket.

Featured April 22, 2022

The Real Reason House Prices Are Skyrocketing: What The Real Estate Industry Won’t Tell You

Almost everyone agrees the main culprit causing our skyrocketing house prices in Phoenix and the United States is the extremely low number of houses for sale. What we don’t agree on is what’s causing the low supply of houses for sale.

September 27, 2022

A Fundamental Reason House Prices Will Fall This Fall

The takeaway is that demand will continue to fall for many months because people are slowly lowering their expectations for future house prices.

August 30, 2022

The Huge Upward Momentum in House Prices is Gone – Check Your City

Prices increased less during the last 12 months than during the previous 12 months in most of the 20 cities covered by Case-Shiller.

August 13, 2022

2 Reasons House Prices Will Start Falling Sooner Than Expected

In our coming house price correction, prices will still be sticky on the downside but two changes since 2006 will make prices a lot less sticky.

May 31, 2022

Real Mortgage Payment Price Approaching 2006 Levels

The U.S. Real Mortgage Payment Price is now higher than at the peak of the S&L boom and is close to the peak of 2000s boom.

April 26, 2022

Summer Will Be The Peak For This Real Estate Cycle

House prices have increased more in the last 12 months than any time in the last 30+ years for these 6 metros…

February 23, 2022

Real U.S. House Prices 12% Above 2006 Peak

Real Phoenix house prices match 2006 peak Note. December 2021 data is the latest available from Case-Shiller as I write this on February 22, 2022. The data is a 3-month moving average so what they call December is really the October-December average. See all 20+ Case-Shiller graphs. Subscribe now

February 19, 2022

Ivy Zelman: “I Think We’re at a Peak”

“I think that there’s risk that these investors are being misled.” Ivy Zelman became famous on Wall Street when she correctly called the housing market top in 2005… and almost lost her Wall Street job because of it. She created her own company and then correctly called the housing market bottom in 2012. After that, she was bullish on housing until last year. Last summer, her housing market research and investment banking firm, Zelman & Associates, came out with a bearish report that cemented her reputation as one of the most independent – and sometimes most contrarian – housing market analysts in the U.S. housing industry. Her disagreement with the…

February 11, 2022

Beyond Supply And Demand: Today’s Tech Is Helping House Prices Skyrocket

Falling interest rates and the pandemic are the top two reasons for house prices skyrocketing over the last year and a half but there’s another reason no one talks about.

January 16, 2022

“It’s A Wonderful Life” & The Weird History Of Building & Loans In Real Life

What happened to “Building & Loans” in real life.

October 21, 2021

Cut Off 10 Years of Mortgage Payments

Homebuyers in this program could borrow the same amount of money but they would pay off their mortgages in 20 years instead of 30 years – with roughly the same monthly payments.

September 28, 2021

U.S. Home Prices Up 20% in 12 Months – Phoenix Up 32%. San Diego Up 28%. Seattle Up 26%.

Note. July 2021 data is the latest available from Case-Shiller as I write this on September 28, 2021. The data is a 3-month moving average so what they call July is really the May-July average. See all 20+ Case-Shiller graphs.

June 29, 2021

U.S. House Prices Up 15% in 12 Months – Case-Shiller

U.S. 12-month house price appreciation was up 15%, the highest since at least 1988. The increase was slightly higher than the peak in 2005.

May 26, 2021

House Prices in 12 months – Phoenix +20%, San Diego +19%, Seattle +18%, and U.S. +13%

When you adjust the Case-Shiller Home Price Index for both inflation AND mortgage rates, you can see that house prices aren’t crazy high!

May 20, 2021

Today – “These prices are crazy but they’re increasing so fast, let’s buy something ASAP”

This summer will it become, “These prices are crazy, let’s wait and see”? My working theory is the Fed started the house price boom when they slashed interest rates again last year after cutting them throughout 2019. In addition, Covid increased demand for houses. In addition, Covid also cut spending on restaurants and travel so people were saving a lot more than usual. At the same time, the 3 stimulus packages may have helped some potential first-time homebuyers pay off their credit card debt, save up more down payment money, and generally become a bit more ready to buy their first house. But, I think, the second most important reason…

May 19, 2021

If You Own a House with a “Challenge”, Now Would Be a Great Time to Sell It

Kristin LaVanway makes a great point in this video at about 9:37 in. I was just thinking the same thing. I remember being surprised back at the top of the market in 2005 that prices for houses that backed to busy streets were about the same as houses that didn’t! The backyard is a lot less useable with all that street noise. Very few houses were for sale back then, like now. If you wanted to buy, you didn’t have many choices. In a normal market, you would have had a lot of choices so most people wouldn’t buy that noisy backyard unless the house was cheaper. I was surprised…

May 18, 2021