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13 U.S. Markets Lost Value Year-Over-Year
On a ‘real’ (inflation-adjusted) basis, home prices declined Year-over-Year (YoY) in ONLY 13 of the 405 largest real estate markets nationwide.
Three of the declining markets are in Texas and three are in California.
(We’ve been warning you about many of the California markets for several years now even though other nearby states and regions had been looking strong.)
In the previous quarter, 8 markets had annual home price declines.
We’re seeing some divergence between the weakening quarterly (QoQ) appreciation numbers and these strong annual (YoY) data. This could be signaling the end of “Pandemic Effect: Phase I” (where housng inventory dried-up) and the start of “Pandemic Effect: Phase II” (the de-urbanization of certain metro marlkets).
(See the entire list of declining markets below.)
In addition to the list of declining cities below, we also use our Advance-Decline (A-D) Indicator that aggregates and tracks Market Breadth.
‘Market Breadth’ is a technique used in Technical Analysis (TA) that attempts to gauge the direction of the overall market by analyzing the number of markets advancing relative to the number declining.
Changes in Market Breadth can act as early indicators for changes in the market cycle.
data looks like for the overall National market.
#1 – When the red chart line is inside the green zone it’s a bullish – or positive – outlook on the overall market.
#2 – When the red line is in the middle zone it’s telling us there is no strong bullish or bearish direction; you must rely more heavily on market-by-market selections.
#3 – When the red line is in the bottom (red) zone, it indicates substantial weakness in the overall market.
This A-D Indicator can also be used on State and Regional levels for more granular insights. PRO level members can customize this Advance-Decline tool by logging in and visiting: Real Estate Market Breadth Analyzer.
Below is the list of cities with
declining Year-Over-Year home prices…
There seems to be a war between all the talking heads and real estate gurus out there about which direction the market is headed.
Half the so-called experts are still calling for a massive market crash. It’s the same Chicken Little blabber they’ve been pushing for years.
Now they’re pointing to all the forbearance properties hitting the market as the next big reason for home prices to fall.
Seems they never run out of reasons to call for a crash, but practically never get it right.
In the other corner, we have the eternal market bulls who’ve been predicting an endless up cycle for real estate because of inventory shortages, low rates, rising Millennial demand and now, the “virtual office” paradigm shift with ‘everyone’ setting up home offices and moving into lower priced, more appealing suburbs and beyond.
These major fundamental jolts can and do impact the price of real estate on a market-by-market basis, but trying to GUESS what the impact will be on ANY local market is the wrong approach.
For example, If the ‘zoom effect’ sticks around post-pandemic, we may very well see a migration out of big, expensive real estate markets. If and when that happens, you’ll be the first to see WHICH MARKETS get hit, and which might benefit – from inside HousingAlerts.
Likewise, for any forbearance-induced foreclosure spikes, you’ll see them coming from a mile away inside HousingAlerts!
HousingAlerts is the most accurate LOCAL real estate market analytics on the planet, for 15 years running.
If your markets are on this list, DON’T panic!
ONE data point, whether it’s for a Quarter or a Year, doesn’t necessarily mean it’s time to buy, sell or hold… or do ANYTHING different, other than pay closer attention. That’s where Technical Analysis (TA) comes in.
TA is a 500 year old science to help predict future market swings. TA is used by every Wall Street investment bank and every global stock, bond, currency and commodities trading firm on the planet for TRILLIONS of dollars in DAILY trades.
We invented TA for local real estate
markets and have the most accurate local
market cycle predictions on Planet Earth
If you want to maximize your Investing, Wholesaling and Flipping profits while minimizing risk, capital and effort in ANY U.S. real estate market, you need to invest WITH the market. Come join us and enter the world of Intelligent Investing.
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