Comments on: Why the housing report presages lower prices http://blogs.reuters.com/felix-salmon/2010/08/24/why-the-housing-report-presages-lower-prices/ A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: q_is_too_short http://blogs.reuters.com/felix-salmon/2010/08/24/why-the-housing-report-presages-lower-prices/comment-page-1/#comment-17657 Wed, 25 Aug 2010 19:33:57 +0000 http://blogs.reuters.com/felix-salmon/?p=5076#comment-17657 main reason as far as i understand is that the housing price numbers lag by a few months plus they are in and of them selves moving averages. so if the prices go down this month we won’t see that in the case schiller until at least october for instance.

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By: canuckA http://blogs.reuters.com/felix-salmon/2010/08/24/why-the-housing-report-presages-lower-prices/comment-page-1/#comment-17632 Wed, 25 Aug 2010 15:00:51 +0000 http://blogs.reuters.com/felix-salmon/?p=5076#comment-17632 Is there any merit in looking at the number of foreclosures that are occupied. Spec housing units that are empty are not the same as overpriced but occupied houses? An occupied house implies some sort of demand by endusers.

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By: Beer_numbers http://blogs.reuters.com/felix-salmon/2010/08/24/why-the-housing-report-presages-lower-prices/comment-page-1/#comment-17622 Wed, 25 Aug 2010 03:29:46 +0000 http://blogs.reuters.com/felix-salmon/?p=5076#comment-17622 Felix,
You could be right, but I don’t think it’s as obvious as you seem to think it is. The market could fail to clear because:
a. Sellers aren’t coming to grips with the new reality and will eventually have to lower their prices to the “real” value.

b. Buyers don’t realize that prices aren’t going to continue falling forever and will eventually have to start bidding what the sellers are asking for.

My point is that a not-clearing market reflects on both the buyer and the seller, and unless you believe that one side of the buyer/seller relation (in aggregate) has much more discretion in transacting than the other, it’s not clear what will happen to prices when transaction volume picks up.

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