zillow.com

[blazespinnaker]

I am using zillow.com to track housing prices, as it seems like a rather reliable source and very much up to date.

Is anyone else using this? From what I can tell, housing prices in the US are ticking gently upwards at the moment after a small slump nov-mar.

[EJ]

Been drifting down around here...

Lexington, MA

[jk]

zillow => prices down 15-20% in the past 4-7 months

according to zillow: in new haven county, ct, prices are down 15-20% from a broad peak which ran nov 05-feb 06.

[btw, if you click on a particular house in zillow it will show you a graph of the value over the past 1 or 5 or 10 years]

[SeanO]

Caution...

Be careful with using Zillow for price analysis. They are using a proprietary automated valuation method or AVM. AVM's have been available from a variety of providers to lenders and others in the industry for quite a while (often at $15-25 per address). Zillow just made it free and easily accessible.

I've spent a lot of time in my business trying to figure out how to use AVM's to replace a currently expensive process of valuing properties to find the best investments (I typically look at 50-100 properties to buy one). Bottom line is that they are typically wrong by +/- 10%. And I regulalry find errors of 30-50%. Basically unusable for my purpose (though lenders have been doing no appraisal loans using them... another source of credit risk).

Also keep in mind that Zillow, unlike some expensive AVM's, does not have MLS access. It's data is based on public records of sale. The property likely went into contract 30-60 days prior to being recorded. And even after it's recorded data isn't readily available to vendors like Zillow for another 2-6 weeks. I think you can pretty much count on a 3 month delay in reporting real market shifts.

Still a great tool to get an idea of home values, especially when used together with a little common sense.

[FRED]

Be careful with using Zillow for price analysis. They are using a proprietary automated valuation method or AVM. AVM's have been available from a variety of providers to lenders and others in the industry for quite a while (often at $15-25 per address). Zillow just made it free and easily accessible.

I've spent a lot of time in my business trying to figure out how to use AVM's to replace a currently expensive process of valuing properties to find the best investments (I typically look at 50-100 properties to buy one). Bottom line is that they are typically wrong by +/- 10%. And I regulalry find errors of 30-50%. Basically unusable for my purpose (though lenders have been doing no appraisal loans using them... another source of credit risk).

Also keep in mind that Zillow, unlike some expensive AVM's, does not have MLS access. It's data is based on public records of sale. The property likely went into contract 30-60 days prior to being recorded. And even after it's recorded data isn't readily available to vendors like Zillow for another 2-6 weeks. I think you can pretty much count on a 3 month delay in reporting real market shifts.

Still a great tool to get an idea of home values, especially when used together with a little common sense.

Sean, here's another source...

View from Silicon Valley

[blazespinnaker]

Be careful with using Zillow for price analysis. They are using a proprietary automated valuation method or AVM. AVM's have been available from a variety of providers to lenders and others in the industry for quite a while (often at $15-25 per address). Zillow just made it free and easily accessible.

I've spent a lot of time in my business trying to figure out how to use AVM's to replace a currently expensive process of valuing properties to find the best investments (I typically look at 50-100 properties to buy one). Bottom line is that they are typically wrong by +/- 10%. And I regulalry find errors of 30-50%. Basically unusable for my purpose (though lenders have been doing no appraisal loans using them... another source of credit risk).

Also keep in mind that Zillow, unlike some expensive AVM's, does not have MLS access. It's data is based on public records of sale. The property likely went into contract 30-60 days prior to being recorded. And even after it's recorded data isn't readily available to vendors like Zillow for another 2-6 weeks. I think you can pretty much count on a 3 month delay in reporting real market shifts.

Still a great tool to get an idea of home values, especially when used together with a little common sense.

Thanks, very detailed, informative, and useful advice.

[SeanO]

Interesting, thanks.

Here in Silicon Valley, Santa Clara and the other more "metro" areas in the region have stayed relatively strong. As you begin to move out into the commuter towns things start to look a bit worse. Those areas are clearly seeing price declines in addition to volume being down and inventory up. I would say that Eric's "Geographic Regions Cascade" article from March is playing out as predicted.

The big question remains... how far will prices decline? So far the drop can be explained away by just the change in interest rates.

Blaze - thanks! Just glad to have a topic I CAN contribute on. :-) I sure appreciate everyone elses posts.

[blazespinnaker]

well, this weeks numbers are out. Home prices across the USA have ticked up 1%, they have been slowing marching up since the beginning of may.

Not what I was expecting in the midst of inventory build up and a housing slow down.

[jk]

variable lags in reports?

i know the various housing numbers, prices, foreclosures all come in with lags. does anyone know what those lags are? also are there gremlins in the numbers? for example new housing orders are reported without including the effect of cancellations.

[metalman]

Real estate expert SeanO says...

i know the various housing numbers, prices, foreclosures all come in with lags. does anyone know what those lags are? also are there gremlins in the numbers? for example new housing orders are reported without including the effect of cancellations.

re Zillow: "I think you can pretty much count on a 3 month delay in reporting real market shifts."

http://itulip.com/forums/showthread.php?p=883#poststop

maybe we don't see things heading down until Q3 or Q4. that's also what homebuilder stocks say...

http://biz.yahoo.com/usat/060627/13611661.html

[SeanO]

Hi JK - In response to your question I've started a separate thread in the housing forum on the problems with the housing data. By no means exhaustive at this point, but it is a start.

[SeanO]

I think the other shoe has yet to drop on how bad things really are for home builders, and their stocks. I have strictly anecdotal evidence at this point, but I'm very concerned. I recently visited a new home subdivision not far from me where homes had been selling for $449k. Homes there are now priced at $369k. Pretending to be an interested buyer to see how desperate they were, they offered to sell me a home for $300k --- 33% off what they were getting 6 months ago. Nothing like this is being reported yet. I believe this is more typical than not. I've been very unsuccessful with timing shorts, and thus lack the confidence to short the builders from their current position... but I'd put good odds on it happening.

[blazespinnaker]

I think the other shoe has yet to drop on how bad things really are for home builders, and their stocks. I have strictly anecdotal evidence at this point, but I'm very concerned. I recently visited a new home subdivision not far from me where homes had been selling for $449k. Homes there are now priced at $369k. Pretending to be an interested buyer to see how desperate they were, they offered to sell me a home for $300k --- 33% off what they were getting 6 months ago. Nothing like this is being reported yet. I believe this is more typical than not. I've been very unsuccessful with timing shorts, and thus lack the confidence to short the builders from their current position... but I'd put good odds on it happening.

Interesting stats

Is this socal? Which subdivision?

Or, if you can give a sense of where it is in relation to a city, that'd be cool too.

You're a magnificent font of info, Sean

[SeanO]

Sorry I can't be super specific right now, but it is a commuter town outside of the Silicon Valley... nothern California.

[blazespinnaker]

sorry, shouldn't be nosy like that in public. I'll IM you and explain my interest.