( HINT: Click-and-drag left-to-right on a chart to zoom in to a specific date range. Double-click on a chart to zoom back out. )
CrystalBull Home Price Indicator ChartThis chart shows the year-over-year changes in the CrystalBull Home Price Index along with Average and Median New Home Price, in relation to the S&P 500.
Note that historically, home prices have trended along the inflation line, with over-bought and over-sold periods. Note also that our prediction in 2009 was accurate: "Expect home prices to start reverting to the mean later this year (after the pending wave of foreclosures and resets)." Home prices should start stabilizing here. A strengthening economy will try to push home prices higher, while the resultant rising interest rates will keep prices in check. Yes, there will be some volatility as home prices find their new, stable levels. US Home Prices generally follow rising wages and economic growth, and are an indicator of economic strength. Since Housing represents a rather large portion of gross domestic product, it is an important data set in market timing methods, and stock investing.
The National Association of Realtors (NAR) will not grant permission to provide graphical analysis of their Existing Home Sales or prices.