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Written by Jonathan Smoke
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11.18.2008 |
 For residential real estate in the U.S., derivatives remain a relatively esoteric concept. For more than two years now, futures based on the Case-Shiller 10-city composite price index and underlying market price indices have been traded on the Chicago Mercantile Exchange.
Trading volumes for the CME housing futures remain relatively thin. Brokers and analysts are perplexed why builders and developers haven’t widely adopted them in such a challenging market. | | No comments for this item |
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Written by Jonathan Smoke
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10.29.2008 |
 I enjoy reviewing the weekly TFS Housing Market Metrics report produced by the US Property Desk of Tradition Financial Services. Their report summarizes the current housing future settlement prices from the CME as well as other spot and OTC metrics.
This morning’s report hit my inbox as I was reviewing yesterday’s S&P Case-Shiller release of August home price indices. The August Case-Shiller price indices showed poor performance for the tracked markets compared to July and August 2007. The only “bright spot” in the report was that the “acceleration in decline was only moderate in August.” | | No comments for this item |
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Written by Jonathan Smoke
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05.13.2008 |
 Yesterday I spotted some light at the end of the tunnel when I saw that price and absorption trends in the listings of homes for sale where both moving in an upward direction. That was based on a 25-city national composite and powered by our new Home Sales Trends intelligence.
One of our astute subscribers quickly pointed out to me that the 10-City Composite, which tracks the S&P Case-Shiller Index traded on the Chicago Mercantile Exchange, wasn’t so encouraging. The chart as of yesterday, courtesy of Altos Research, shows that while the 90-day price trend is slightly upward, the 7-day price trend fell through the 90-day trend in April and hasn’t recovered. | | No comments for this item |
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Written by Jonathan Smoke
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02.28.2008 |
 The relatively thinly traded Housing Futures on the Chicago Mercantile Exchange have been decidedly bearish about the future. As extended multiyear contracts began trading, the view out for each of the 10 cities and the 10-city composite has been negative.
At the beginning of 2008, that negative view was apparent. For example, each of the west cities, as illustrated on this January 8, 2008 price curve chart from TFS Derivatives Corp, showed declines at least for another two years but most declining three full years. | | No comments for this item |
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Written by Jonathan Smoke
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11.28.2007 |
 To our loyal readers, I humbly apologize for not posting any new commentary for a week. First it was turkey, then football, and this week a never-ending litany of depressing but not that informative news.
Let me recap the news this week: Prices are down. Sales are down. Inventories are up. Housing malaise and foreclosures may sink the whole US into a recession if exports and investments from Middle Eastern sovereign funds don’t save us. | | No comments for this item |
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Written by Bill Russell
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10.05.2007 |
 According to Thursday’s Wall Street Journal, the new, longer CME home price options are predicting horrendous price declines for major housing markets. The worst four year price changes are for Miami (-27.9%), San Francisco (-25.9%), San Diego (-18.6%), Las Vegas (-18.1%) and Los Angeles (-15.0%). | | This item includes 1 comment |
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Written by Jonathan Smoke
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08.29.2007 |
With the release of the of the June Standard&Poor’s/Case-Shiller price index yesterday, most of the housing headlines today are focusing on the price declines revealed in the lagged index. The company reported negative annual returns in their U.S. National Home Price Index, 10-City Composite and 20-City Composite, as well as 15 of the 20 metro area indices covered when comparing June 2007 with June 2006. | | No comments for this item |
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Written by Jonathan Smoke
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08.13.2007 |
 Last week the Chicago Mercantile Exchange announced it was extending the length of its housing futures and options from up to 1 year to as long as 60 months beginning September 17.
According to the CME’s announcement, contract months extending out 18 months will be listed on a quarterly cycle of February, May, August and November. Contracts listed 19 to 36 months out will be available on a biannual schedule of May and November contracts. An annual November listing schedule will apply to contracts listed 37 to 60 months out into the future. | | No comments for this item |
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Written by Jonathan Smoke
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08.07.2007 |
 One of my first posts on Housing Intelligence was about a new daily spot home price index being developed by Radar Logic.
Yesterday Radar Logic announced the formal launch of the daily price indices for 25 markets. The company also announced license agreements with several major investment firms -- Morgan Stanley, Lehman Brothers, and Merrill Lynch -- that plan to begin trading over-the-counter contracts based on the price indices starting in September. | | No comments for this item |
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Written by Jonathan Smoke
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04.26.2007 |
 A very appropriate and pointed question was poised by Neal Elkin of Real Capital Analytics in the Wednesday afternoon session of the Real Estate Derivatives World. Are derivatives at a point that they are being bought or being sold?
For both commercial and residential real estate derivatives in the U.S. at least, the answer is decidedly that they are being sold. Or should I say they need to be sold. | | No comments for this item |
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Housing Derivatives 
