There’s been an ongoing inconsistency between forward prices in the CME Case Shiller futures, and the quarterly Pulsenomics survey of home price forecasts. CME futures (at least those for 2020 and beyond) are priced at levels that appear to have a much less bullish outlook than the Pulsenomics surveys. There … Read More
Quotes on the CME Case Shiller home price futures contracts were generally higher after this morning’s release of the Case Shiller numbers for April. The table below highlights prices from near the close yesterday versus early this morning. There are three key highlights;
- Average mid-market prices rose by 0.4 for
One reader -Justin Welsh- wrote an 11-page description of why a homeowner might want to consider hedging with home price futures. Justin’s report goes into a lot of detail, provides a number of graphs, and walks through various scenarios. The report has quite a bit of detail. I’ve attached it … Read More
The Wall Street Journal had an article Tuesday morning (see link) titled “Mortgage Break Faces Irrelevancy” which outlined possible impacts from proposed tax changes. The author (Laura Kusisto) quoted several sources each of whom suggested that, under the current proposal, fewer taxpayers would be able to take advantage … Read More
Since home prices turned up in 2012 the California markets (i.e. LAX, SDG and SFR indices) have consistently outperformed the CUS-10 index.
The graph (to the right) shows year-on-year percent changes in the CUS-index (in black) along with those for LAX, SDG and SFR. It has been a near truism … Read More
For the last two months, I’ve been writing about how quotes in longer expirations have been coming down, both on an absolute basis, as well as against front contracts. No contract reflects that trend better than SFR. In addition, I find that when you get changes in sentiment, trading volume … Read More
While I may not be swayed by one trade, I can clearly use it to talk about it as a market-clearing event that others might want to discuss, and possibly (hopefully) react to.
Last week there was a calendar spread trade in SFRX16/X17 at 8 points. Recall that a calendar … Read More