As if there wasn¿t enough confusion, we now have VERY conflicting reports on the housing market from different reporting arenas. The federal government's housing price index is produced quarterly by an agency called the Office of Federal Housing Enterprise Oversight (OFHEO). It measures the change in home values in a massive database of millions of homes whose loans were refinanced or newly financed by government backed loans known as Fannie Mae and Freddie Mac.

This data covers nearly 300 major metropolitan markets and dozens of smaller metro areas. In its latest index, November 29, 2007, OFHEO reported prices in some markets down by 10% or more in areas of CA and FL. BUT it also found average price gains of 13% in Utah, 12% in Wyoming and 7%+ in Montana, New Mexico and Washington. In addition, it reported stable prices or modest gains in 204 of 287 cities, declines in 83 and an average national appreciation rate of 1.8% for the 12 months covered by the study. Whew...got all that?

Now..compare those numbers with Standard and Poors/Case-Shiller study that was released the same week. It found prices down in 15 of the top 20 real estate markets which include an 11% decline for Tampa, 10% for Miami and 9.6% for San Diego. Overall, according to Case-Shiller, average home values dropped by 5% for the 12 month period. What is going on?? Well, for starters the two surveys are measuring VERY different things but the news reports fail to mention that.

The Case-Shiller index has no data WHATSOEVER from 13 states and INCOMPLETE data from 29 states. It also does not cover condos or refinances but does cover houses with sub-prime and jumbo loans. In contrast, the OFHEO study covers every state which is VERY important because some of the strongest state and local housing markets today are in areas missed or not completely covered by Case-Shiller. BUT...the OFHEO numbers have limitations as far as minimal coverage of houses with sub-prime mortgages, no jumbo loans and no FHA.

Technically, both indexes are probably correct but they are not looking at the same houses or even the same local markets. More importantly, neither of them will tell you the value change of a specific house in a specific neighborhood during a specific period of time and THAT is what we really need to know.

The data is very confusing (no kidding). Locally, we are seeing a bit of an increase in activity and are VERY positive about the market. Hopefully this has at least helped explain why the data we receive can be so confusing.

Talk To Carol for a very specific market study of your neighborhood and the general surrounding area. This is TRULY a customized analysis tailored just for you. We never use generic studies that are provided by a 3rd party.