Case-Shiller: Nationwide Markets Simultaneously Bouncing Up

It’s time for our monthly check-in of the S&P/Case-Shiller Home Price Indices (HPI). For the full source data behind this post, plus seasonally adjusted and tiered price data, hit the S&P/Case-Shiller website. For an explanation of how the Case-Shiller data is calculated, check out their methodology pdf. Also remember that the data released on the last Tuesday of a given month is for the period two months prior (i.e. – June data is released in August).

Here are the basic Case-Shiller stats for the Boston area* as of June:

Sixteen of the twenty metro areas tracked by Case-Shiller saw an increase in their respective seasonally-adjusted HPIs between May and June. Only Las Vegas, Detroit, Seattle, and Charlotte still saw seasonally-adjusted drops month-to-month.

Despite having seen some of the smallest overall declines since its respective peak, Boston seems to be experiencing one of the strongest gains in this spring’s nationwide bump. This is probably due at least in part to the fact that Boston’s seasonal bounces seem to be stronger than most other cities every year.

Here’s a chart of Case-Shiller HPIs for all the markets that Redfin serves:

Here’s our peak decline chart, in which we line up the peak Case-Shiller HPI value for each of Redfin’s markets, so we can see how long each market has been declining, and how much it has dropped from the peak.

It’s quite noticeable in both of the above charts that almost every city we’re tracking seems to have taken a sudden upward turn with the most recent few months of data. Despite the fact that there was a nearly two year spread in when the various markets hit their peak (Boston in September 2005, Seattle in July 2007), nearly every market appears to have turned a sharp corner to the positive after “bottoming” in March or April.

A commenter on my Seattle site made an astute observation about this phenomenon this morning:

Since it is still essentially true that “real estate is local”, what could cause every city to suddenly and simultaneously reach an equilibrium point where prices reversed course?

Answer: it just so happens that the home buyers’ tax credit was enacted with the American Reinvestment act (stimulus package) effective February 17, 2009. March 2009 was the first full month that American home buyers had the tax credit as an incentive. It changed their behavior and made them buy homes. It also expires on December 1, 2009 unless it is extended.

Once again, government policy is impacting asset valuations. Either we’re seeing a lasting nationwide housing bottom marked by an extraordinarily well-timed tax incentive, or a new “bubblet.” Case Shiller won’t tell us which until 2010.

It remains to be seen whether the NAR’s lobbying efforts to get the $8,000 tax credit extended beyond November will be successful. And even if they do convince Congress to extend it, the effect may be largely diminished. The program may have already pulled forward as many sales as it can during its spring and summer run.

*[Case-Shiller defines Boston as the entire Boston-Cambridge-Quincy, MA-NH Metropolitan Statistical Area, which includes all or part of the following counties: Essex MA, Middlesex MA, Norfolk MA, Plymouth MA, Suffolk MA, Rockingham NH, and Strafford NH.]

50% Of Our Clients’ Offers Were On Homes With Multiple Bids

In July, half of the offers we presented to listing agents were on homes with at least one other offer.

“We’re seeing a lot of multiple offer situations in Belmont, Brookline, and Arlington,” says Adam Welling, the top buyer’s agent in eastern Massachusetts. “In Belmont, it’s the homes over $500,000 that are getting a lot of attention, while in Brookline and Arlington, there’s a lot of activity on condo units in mid-rise buildings.”

Tips For Bidding On A Home With Multiple Offers

For Adam, the best strategy is to act quickly and lead with a strong offer:

Know the market and what you want so you’re ready to jump when you see something you like. To show the sellers you’re a serious buyer, make your first offer count.

The Busy Season Is Going Into Extra Innings

Traditionally, the Boston real estate market heats up in June and July and begins to slow in August. This year June and July were busy, but we’re not seeing things taper off like normal. This past weekend our Boston agents received a ton of offers to write up and present to listing agents.

This is due to two things:

1. The first-time home-buyers tax credit expires soon. To qualify for the tax credit you need to close on your home by November 30. In Boston, it’s taking more than 50 days after agreeing to terms for our clients to take possession of their homes. If you’re hoping to get the tax credit, you have a little over two months left to find a home.
2. Interest rates are still low. While mortgage interest rates are not as low as they were earlier in the year, they are still well-below historical levels.

What trends are you seeing in the Boston market right now?

The Market Wrap-Up For July

Let’s take at look at the July numbers for eastern Massachusetts and see how they compare to a year ago.

Single-Family Homes & Condos

• 4,577 homes sold, up from 4,223 in July 2008
• The median sales price was $330,000, down from $344,000 in July 2008
• Homes that sold were on the market an average of 120 days, down from 124 days in July 2008.

We pulled these numbers from MLSPIN.

Dig Deeper Into the Trends

These numbers are for eastern Massachusetts. To see what’s happening in your neighborhood, check out our stats & trends pages.

This is our first monthly report on the inventory trends in the Boston area. What numbers would you like to see in our August wrap-up?

Redfin Has The Top Three Buyers’ Agents In Eastern Massachusetts

June and July have been amazing months for our greater Boston agents!

In June, Sean and Hannah were the top two buyer’s agents in the Boston area. In July, our Boston team has the top three spots:

It’s great to see that since starting in late April, Adam has quickly adjusted to working at Redfin. He’s hitting everything out of the park (if only Papi would follow his example, we’d be chasing the pennant, not the wild card!).

When you work with Redfin, you’ll be working with some of the best agents in the greater Boston area. Adam, Sean and Hannah know what’s going on in the market right now because they spend all of their time serving clients: touring homes, writing offers and closing deals.

We pulled these numbers from MLSPIN, the database for real estate transactions and listings for Massachusetts, and ranked agents who represented home-buyers of single-family homes and condominiums in July based first on number of deals, then by total dollar amount.

Our Clients Love Our Service

We survey every client and track every transaction in a central customer database. For the surveys we received in July from our clients in the greater Boston area:

• 35 clients responded to our customer-satisfaction survey and posted a review online, down from 44 in June.
• 35 of those clients, or 100%, would recommend Redfin to a friend, up from 98% in June.

In these surveys, Redfin asks customers to rate the likelihood that they would recommend Redfin to a friend on a 0-to-10 scale. Customers who rated 6 or higher count as people who would recommend Redfin to a friend.

We’re also thrilled that four of our clients gave us five-star reviews on Yelp. Here’s part of what steve m. said in his review:

I just recently purchased my first home using Redfin and with all else being equal, I actually can’t understand why you wouldn’t use them. I was fairly uneducated about the process – but they guided me through it all from the offer to the P&S, inspection and closing. they had great references for everything you need throughout from inspectors to attorneys. Nancy was great on home tours and Sean excellent throughout the offer/closing process.

For more numbers, download the spreadsheet with the data on what happened in July.