I've edited illustrations of singld contracts to bring in three new bits of information:
1) Intercity Spreads between a metro and the 10-city index contracts. (See https://www.homepricefutures.com/posts/intercity-spreads-explained for an explanation of how to convert prices into HPA differences).
2) Calendar Spreads for the February expiration cycles, and
3) A graph of the ratio of the metro vs 10-city index over time, and with Intercity Spreads converted into forward ratios.
I'm showing the WDC (Washington) contract as an example below.
CME quotes are shown in the upper left corner. Those quotes are also converted into "Mkt % Spot" to show any implied gains in HPA over time. (Note that there are other contracts -that I will start showing when Feb '25 expires next week -to include May '25, Aug '25, Nov '25 and May '26. I typically quote the Feb '25-'26-'27 contracts and am looking for someone to take over market-making duties on Feb '28 and beyond.
The lower left corner has a graph of the historical index (in black) with bids and asks for the CME contracts superimposed (bids in blue, asks in red). Two things to note: 1) the expiring Feb '25 and historical index converge as the Feb '25 contract settles on the index published the last Tuesday of the expiration month. and 2) the forward curve tends to flatten out over time, both due to fewer buyers of longer-dated exposure and growing uncertainty as the time-to-expiration extends.
The lower right corner shows the ratio of the WDC index vs the HCI (10-city index) over time (with December values highlighted in red to avoid seasonality bias. WDC has generally been underperforming the 10-city index for the last nine years. The blue and red symbols are the values of the CME forward contracts converted into ratios. Note that this is an effective tool to see trends in out-/umder-/ performance. In addtion these ratio agreements can be used on any top-50 metro referencing other indices (e.g. Freddie Mac, Zillow) for metros that don't have CME contracts (e.g. Nashville, Minneapolis, Houston and Salt Lake. See https://www.homepricefutures.com/posts/adding-more-information-to-reformatting-hphf-ratio-agreement-template for a blog explaining HPHF Ratio Agreements).
Finally, the upper right corner shows both the InterCity Spreads (WDC v HCI) and Calendar Spreads for this metro. HCI is currently priced with a slight bias toward HCI outperforming WDC. (See above for how to convert price quotes into implied HPA and how IC spreads work.
The calendar spreads reflect levels of implied HPA in the stated metro contracts either between Feb '25 and Feb '26-'27.
There's a lot of information here, so please feel free to DM me if you have any questions OR if you'd like to see quotes on other metros.
Thanks, John
