Housing Market Vitality
Know the future.
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Housing Market Vitality Indicator™ (HMVI) gauge the impact of prevailing economic conditions on future house prices.  What we pay for a house is determined by how much we make; how we feel about the future; the state of the local economy; the national economy; the availability of properties for sale; and a myriad of other interconnected factors.  Factors that are routinely published, reported, and oftentimes contradictory. Using a proprietary methodology, HousingIQ boils all this data down to usable, aggregate numbers that answer the question: How will this impact house prices?

Housing Market Vitality Indicators™ equip buyers, sellers, lenders, and investors with a granular, timely, and fact-based perspective on the housing market. The monthly US Housing Market Vitality Indicator provides information about the future direction of US house prices. State Housing Market Vitality Indicators offer a more granular perspective and the Metropolitan Housing Market Vitality Indicators add local color and provide an actionable ranking of the markets.

The US Housing Market Vitality Indicator measures the aggregate impact of economic factors on US house prices. 

Various national house price indices such as Case-Shiller and FHFA HPI provide a snapshot of price changes derived from current transactions and give historic context. In contrast, the US Housing Market Vitality Index, using factual economic data, provides information about the future direction of the national housing market. It answers the question: How will this impact house prices?

A value of 100 corresponds to conditions supporting current prices; values less than 100 correspond to a dampening effect; and values greater than 100 indicate a positive effect on house prices. 

The US Housing Market Vitality Indicator distinguishes between a metro market that is improving (deteriorating) in vitality and a market that is outperforming (underperforming) the national market.  Both present different opportunities. A market that improves by 5% when the national market gains 10% is different than a market that declines by 5% when the national market drops by 10%. The first example identifies an underperforming, albeit money-making, situation and the second identifies a money-losing, yet outperforming situation. Clearly, one must pay attention to local markets to uncover opportunities regardless of the national trend.

 

Definitions
3-month moving average
Trailing three month geometric mean
12-month change
Log change in value vs. 12 months ago
%markets increasing
Percent of metro markets improving in vitality
%markets outperforming
Percent of metro markets outperforming national market

State Housing Market Vitality Indicators measure the aggregate impact of economic conditions on house prices statewide. They present a more granular perspective than the US HMVI. State indicators enable objective comparisons among states. They are derived from the metro housing markets comprising each state.

 

The Metropolitan Housing Market Vitality Indicators measure the performance of metro housing markets relative to the national market.  They answer the question: How will the change in house prices in a particular market compare to the change in house prices across the US?

Metropolitan Housing Market Vitality Indicators reflect the variation across geographies. With over 130 million housing units spread across more than 400 metros, the national market is large and diverse.  The Los Angeles-Long Beach-Glendale, CA market, with a population of over 10 million and over 3.5 million housing units is as large a housing market as all of Sweden. In contrast, the Carson City, NV metro market has fewer than 25 thousand housing units.  The local economy of Orlando-Kissimmee-Sanford with the recent manufacturing resurgence is different than the Boston area high tech and defense sector specialized economy. 

The unique characteristics of each metro market drive house prices differently and sometimes in a direction opposite to the national market. Metropolitan Housing Market Vitality Indicators empower meaningful, data-driven, objective comparisons between different markets.

Definitions
Market Rank
Rank of the market derived from its Situation and Outlook scores
Situation
A summary of current local market conditions 
Outlook
Forecasted change in Situation

For details about the metrics, see Metropolitan Housing Market Rankings.

 

Metropolitan Housing Market Vitality Indicators allow ranking markets by three metrics–Market Rank, Situation, and Outlook

Market Rank is a composite derived from the local market’s Situation & Outlook. It answers the question: How does this area compare to other areas at this point in time? It provides a balanced perspective of the impact of prevailing economic conditions and the forecasted change.

A market’s Situation summarizes the local economic conditions as they impact house prices.  It answers the question: How are things in comparison to the national market? A market’s Situation can be Outperforming, Tracking, or Underperforming based on whether the local conditions will drive house prices higher, the same as, or lower than the national market change.

A market’s Outlook describes how its Situation will evolve in the future.   It answers the question: Where are things headed? Outlook can be Positive, Neutral, or Negative based on whether the market’s Situation is forecasted to improve, stay the same, or deteriorate.

Examining Situation & Outlook shines a light on market opportunities. For example, markets that are Outperforming with a Negative Outlook present a different risk profile than markets that are Underperforming with a Positive Outlook.