Oct 22, 2010 00:00 ET Market Alert: Clear CapitalTM Reports Sudden and Dramatic Drop in U.S. Home Prices First Index Report for October Shows a Two-Month 5.9% Price Decline Representing a Magnitude and Speed of Decline Not Seen Since March 2009; Similar Declines Expected to Appear in Other Industry Indices in Coming Months TRUCKEE, CA--(Marketwire - October 22, 2010) - Clear Capital (www.clearcapital.com) is issuing this alert on a dramatic change observed in U.S. home prices. "Clear Capital's latest data through October 22 shows even more pronounced price declines than our most recent HDI market report released two weeks ago," said Dr. Alex Villacorta, senior statistician, Clear Capital. "At the national level, home prices are clearly experiencing a dramatic drop from the tax credit-induced highs, effectively wiping out all of the gains obtained during the flurry of activity just preceding the tax credit expiration." This special Clear Capital Home Data Index (HDI) alert shows that national home prices have declined 5.9% in just two months and are now at the same level as in mid April 2010, two weeks prior to the expiration of the recent federal homebuyer tax credit. This significant drop in prices, in advance of the typical winter housing market slowdowns, paints an ominous picture that will likely show up in other home data indices in the coming months. For example, both Clear Capital and S&P/Case-Shiller indices have displayed consistent market peak, trough, secondary trough, and tax credit run-ups. Despite these consistencies, a critical difference is that HDI's patent pending methodology enables more timely and granular reporting. Therefore, if previous correlations between the Clear Capital and S&P/Case-Shiller indices continue as expected, the next two months will show a similar downward trend in S&P/Case Shiller numbers. Clear Capital HDI Methodology Generates indices in patent pending rolling quarter intervals that compare the most recent four months to the previous three months. The rolling quarters have no fixed start date and can be used to generate indices as data flows in, significantly reducing the multi-month lag time experienced with other indices. Includes both fair market and institutional (real estate owned) transactions, giving equal weight to all market transactions and identifying price tiers on a market specific level. Drilling down beyond core trends of large areas within macro-sized markets, these models are combined with an address-level cascade to provide sale-type-specific analysis for thousands of more granular geographic areas across the country.
Provides weighted repeat sales, and price-per-square-foot index models that use multiple sale types, including single-family homes, multi-family homes and condominiums.
