Trend Charts

Tons of fun new features going on here at Altos Research. Today we get to announce AltosXplorer: our full database query and charting system, is now mobile! That's right folks, a couple terabytes of real estate statistics and pretty charts right at your fingertips.

Altos subscribers: Get your AltosXplorer mobile link by logging in to your account and selecting My Xplorer, Xplorer Mobile from the menu. Then send the URL to your phone. That's it! (You will, of course, need a phone with a web browser. And it'll need to have javascript enabled. My Blackberry did not have javascript enabled by default, FWIW.)

On your phone, you'll be able to select market area, city, zip code, and any of a bunch of different statistics. Want to take a peek at condo inventory trends while showing properties to a buyer client? Just a couple of clicks and you're at the data.

Lead Contact Form Goes Mobile Too!

Many of our realtor subscribers like to use the data to reach new clients. What do you do when you find yourself engaged in a conversation about the market with a someone? Well now you can say, "Here, let me send you a report, you can check for yourself." The AltosConnect mobile lead-sign-up form is super handy. Pop in their name and contact information and they'll have a local market report in their inbox before you're even done with the conversation. How cool is that? We rolled this out a couple weeks ago. Lots of positive response.

To get the link to the mobile version of your AltosConnect contact form widget, sign in to your account, select My Connect from the left hand menu, Save and Preview the widget, and enter your phone number. Again, that's it! Bookmark it on your phone and you'll always have access to your Altos database.

Give both features a try and let me know how they work for you!

We've been quietly rolling out new features for subscribers here at Altos World HQ over the past couple weeks. Today I get to announce a super cool new feature that our subscribers (especially the bloggers in that crowd) have been raving about. [sound the trumpets]

AltosStats Live Market Statistics Widget

Previously our widgets were trend charts. Plug in a chart to your site to illustrate the trend of one or two local real estate statistics. But the data is often just as interesting in a table format - the precise reading, right now. Good information density as Tufte likes to say. To whit:

We built the AltosStats widget to work like our other widgets. Just copy a little chunk of HTML and Poof! Live data on your site.

If you're an Altos Pro subscriber, here's how you can play: Log in to your account. Select the My Web Page menu item. Then click the Stats Widget link next to the market you want to display. That's it. All the data is live and all the formatting is done for you.

We made a skinny version too so you can drop one in the blog sidebar.

There you have it. Enjoy.

Some nice press coverage in BusinessWeek this week. We compile unique luxury real estate data for our friends at the Institute for Luxury Home Marketing. If you stopped by the ILHM booth at NAR last week, you'd have seen the great report that their members have access to. The Institute launched the reports at the show.

Coincidentally, BusinessWeek called looking for insights on how the real estate market is performing at the very high-end. The short answer is that, while the luxury market held out longer than the low end, everyone is feeling the pain now.

"The entry level of the upper tier--the $500,000 price point and up--has been softening for a while," said Laurie Moore-Moore, founder and CEO of the Institute for Luxury Home Marketing, a Dallas-based group that trains high-end agents. "What we've also seen in the last month is huge uncertainty at the very top of the market. People want to know where are we headed, how serious [the downturn] is going to be, and what is the duration. There are enough questions that at even at the top of the market people are waiting and watching."

Here's how our Luxury Real Estate Market data works: We take the 10 highest-priced zip codes in 31 metro markets around the county (as long as their median price is over $500,000). We composite those zip codes together into a metro regional view (for example of the luxury real estate market in Los Angeles). Then we roll all the metros into a nation-wide view, which we call the ILHM National Composite.

The data and report are available only through ILHM and ILHM members. If you're interested in seeing all the detailed statistics at the national level, you can download the weekly National Luxury Market Report from ILHM. Institute members have access to the detailed luxury data in their local markets as well, which is cool.

For years I've written about the function of NASDAQ stock wealth on prime Silicon Valley real estate. I like to summarize with this phrase, "You don't buy a $2 million home in Palo Alto with a $1.8 million sub-prime loan. You buy it with $1.35 million in NASDAQ capital gains and a $650,000 in financing."

That fact has buoyed real estate demand and prices from Saratoga through San Francisco in the past two years - even as the lower end of the market has been pummeled.

Consider this: two companies (and their stocks), Apple (NASDAQ: AAPL) and Google (NASDAQ: GOOG), minted several thousand local millionaires between 2004 and 2007. (The back-of-the-envelope calculation works like this: Of GOOG's 16,000 employees assume 5,000 locals are mostly vested. Assume they collectively own maybe 8% of the company. At GOOG's 2007 peak of $711/share that's $18 billion in local wealth created since 2004. AAPL has a similar scale from an $11 stock in 2004 to $190 peak, spread over maybe 8000 vested local employees, is an additional $13 billion of local capital gains wealth created in the preceding four years.)

Many of those newly wealthy want to buy a home. The result is that simply from Google and Apple you have hundreds or even thousands of buyers at the high-end of the market.

Couple this demand with the peculiar small-supply situation of the local region (limited new construction yields only a handful of available properties) - and you get the recipe for resisting the bursting bubble right up through the first half of 2008.

Local Realtors know that the supply side of the equation is not likely to change drastically. There are simply no homes being added in close-in Silicon Valley unlike, say suburban Phoenix.

So the recipe depends on capital-gains-wealth-driven demand.

And guess what? Year to date for 2008, both GOOG and AAPL are down by half. In the last 9 months or so, $15 billion of local wealth in just those two stocks has evaporated.

The bubble burst has only started to hit us.

[note: I am aware this is an over simplified argument. Home prices do not correlate with the movements of any one stock. We've checked. In some of these markets, they do correlate with movements in the NASDAQ as a whole, and we all know this isn't an isolated dip.]

We love it when our clients get good blog fodder from our data. We need to be more diligent about showing the link love to 'em. Surfing around with a little insomnia tonight I found a whole set from just the last day or two. Check out these wonderful realtors with great, data-rich blogs:

Wilkas Group in San Mateo

Irina Natchaev dives into the San Gabriel market

Ryan Hartman in Philadelphia (Welcome aboard Ryan!)

Marian Bennett in Half Moon Bay

Here's a special hint: if you're a home buyer or seller looking for data in any of these markets, you can actually subscribe to the detailed local reports from us. But why would you? These marvelous pros will give you the reports for free! How cool is that?!

Over the past couple of years, we've built our client base with realtors and investors, buyers and sellers, with appraisers and traders, with planners and researchers.

During that time, our products for those folks have taken the form of either detailed analytical reports or simply raw data. Either we do all the analytical work, or you do it.

More and more though, we found that there is a big group of people who need an easy way to solve more unique problems than we can possibly address in our pre-designed local reports, but these folks have neither the time nor the experience to sift through the mountains of real estate data on their own.

We realized we needed a product that lets our clients easily query the vast Altos Research database to get the specific answers they need, and use the output in any number of different ways. Thus AltosXplorer was born.


AltosXplorer is for you if you've ever looked at our report products and said, "I don't need just one city, I need to be able to investigate any stat for any zip in the whole area (region, state, country)." Think about the investor who has opportunities that may come up anywhere in Florida, and wants to quickly compare two markets when a new deal arrives.

Or consider an appraiser who works all over Chicagoland. Any given day he needs to illustrate just a couple of key measures in a neighborhood to augment the rest of the data in his report.

For our Realtor clients, AltosXplorer is a lot of fun too. Previously, in order to use our AltosCharts you needed to formulate a long URL to get the right chart. With AltosXplorer, you build the chart you want with just a few clicks and then click, copy and paste! (See Kris Berg's first foray for the perfect example of how AltosXplorer was intended for our Pro clients.)

Can you tell we're giddy around here? I could go on and on but I'll wrap in a single (albeit multi-claused) sentence:

AltosXplorer is a rich internet application that enables you to do your own analysis, create your own trend AltosCharts, on our full database, and export the data to your own analysis in just a few clicks.

Learn more here. Try it out here.

Enjoy.

Oh my.

Three of four homes for sale in Stockton are in- or on the path to- foreclosure.

Yesterday I wrote about Chicago's dubious distinction as the most socially regulated city in the US. I argue that trend does not bode well for the creative class, the city's future prosperity and ultimately its real estate values over the long haul. However today I came across a glowing article on Chicago in Fast Company, calling it "City of the Year". Indeed it's a city I love, so let's look at the positives.

Fast Company lauds some of the city's social restrictions as forward thinking "Greening" efforts. (Ironically they also posit that the city's position as anchor of 20th century architecture happened here because there was "no one to tell [the developers] to do it differently.")

Construction Booms
Most of what FC is happy about though derives from, Chicago's marvelous growth spurt. The city is the fastest-growing non-Sun Belt city in the US. The economy is growing faster than New York or LA. Immigration remains strong from all over the world.

While highrise condo development has slowed from it's frenzied pace a few years ago, I'm still excited about the Chicago's recent construction boom. The famed skyline is remains one of the most moving in the world. And its development continues. (I highly recommend the Chicago Architecture Foundation's boat tour if you have 90 minutes to spare while you're in town.) Between the 150-story Chicago Spire and the new Trump tower (who let him in there?) the city will remain on the forefront of skyscraper architecture.

With all this development, it's worth a look to see how the downtown Chicago condo market is holding up. Here's a handful of zip codes:


Let's look at demand rates also.


Like much of the country, the most desirable parts of town have (those with the higher prices already) show reasonably consistent demand and stable prices. This is not the case as you leave the hot neighborhoods.

So what's in store for the City? Construction, investment, and immigration warm my heart. Laws to dictate my diet chill me to the bone. The good news is that buildings last a long time. Bad laws can be as ephemeral as the foie gras they're restricting. Let's call this one a net positive.

Rock on Chicago.

Link: Chicago Real Estate Data

Checking out Andy Kaufman's blog this morning, I couldn't help but noticing the contrasting AltosCharts he's showing for Oakland and Berkeley California.

Oakland of course is the bigger city, but these next-door-neighbors share some parts that are virtually indistinguishable from each other. There are some spectacular parts of Oakland and sketchy parts of Berkeley and vise versa. But look at the home price trends over the last year.

Likewise look at the trends in inventory levels for the same to cities.

You couldn't have a clearer picture of the real estate pricing phenomenon we're seeing all over the country. It works like this:

• Demand is off everywhere and everyone knows it.
• So if you're a home buyer in the East Bay with good cash and good credit, you get your pick. In this case, Berkeley has generally better schools, more cachet, etc., so the buyers go there first.
• There's enough demand to keep the market afloat.
• If you don't have good cash and good credit, you get nothing. There is literally no spillover demand for Oakland.
• A few years ago, a home buyer might look to the nicer neighborhoods in Oakland for additional inventory or a lesser school-premium price. Not the case any more.

Actually, I'm sure we could dig through the zip code level data in Oakland and illustrate a similar phenomenon within the cities themselves. But this particular story jumped out at me this morning, so that's what gets covered.

Altos Links: Oakland real estate data, Berkeley Real Estate Data

Spent much of the day looking up data for press requests. Everybody wants to know if we're at a bottom. Thought I'd drop some in here. Not a lot of time to write today, so here are some comparison charts for homes around the Bay Area. San Francisco, Burlingame, Walnut Creek, and San Jose. All Data as of April 11 2008.

If you've ever needed an illustration of the supply/demand curve, here is one for you, via the real estate market. I grabbed the inventory levels of four cities, each about 30,000 people big, all reasonably prosperous, nice places in their respective regions. Frisco, Texas; Sammamish, Washington; Los Altos, California; and Winnetka, Illinois.

My overblogging tendencies want me to expound on the reasons for these inventory differences: building regulation, NASDAQ exposure, etc. But I won't. I'm just going to give you the price chart that illustrates the inversion, and let you conjecture for yourself.

Altos Links:

Sammamish real estate data

Los Altos real estate data

Winnetka real estate data

Frisco real estate data

AltosChart of the Day: After an intense run-up in inventory levels in the Las Vegas market last fall, we've now seen several month of stabilization. Still all kinds of craziness to shake out there, but are we seeing a the first inkling of the bottom? Prices show no signs of coming out of their swoon yet. So you be the judge.

Altos Links:

This is data for the whole Las Vegas MSA. The latest data will be in our forthcoming National Real Estate Report later this week.

Here's the Las Vegas Real Estate Report for the city.

I'm a big fan of the technologies shaking up the real estate industry. Though my perspective differs from the simple-minded view that agents simply make too much money and that technology will only cut the 6% commission to the bone. In fact, I've written previously that innovations in real estate may indeed help agents to charge a premium, to meet a particular need for a home seller -- if they want to sell fast or get a certain price, for example. Further, I've suggested that Redfin can save their business if they admit that some clients want a great internet home buying experience and are willing to pay a premium for a premium service.

Today Prashant Gopal at BusinessWeek has an article citing how these premium relationships are happening, even in this crazy bad market.

... [Seller] McCarty decided a year ago to give real estate agents an added incentive to guide buyers [to his] house about 20 miles outside of Minneapolis. He agreed to pay his agent an 8% commission, which would be split (55%/45%) with the agent representing the buyer.

...

"I wanted more agents to show the property," said McCarty "I was willing to take a little bit more of a hit and pay a higher percentage"

...

Frank D'Angelo, the broker for EXIT Realty Executive who represented McCarty, says he offers customers a transparent, tiered system of payment. For 6%, sellers get the typical menu of services. Sellers who agree to pay 7% get additional benefits, including a guarantee that if the home isn't sold within 39 days, he'll return up to $10,000 of his commission (2% of the sales price). For 8%, buyers also get free home-staging and a "media blitz" of advertisements.

Great stuff. The 6% should be fluid depending on your goals. Discountability is good, if that's what your clients want. Just remember that, especially in a lousy market, some are willing to pay a premium to move a home quickly.

A Look at Minneapolis Real Estate Trends

Just for kicks, let's look at the real estate data for the Minneapolis region to see if McCarty got a good deal. First lets look at the price trends for the Twin Cities.

McCarty's house was priced at about $325,000 solidly in the Second Quartile of homes in the Minneapolis region. What about the Days on Market for homes in that price range?

For homes priced around $300,000 to $400,000 in Minneapolis, the Second Quartile, homes are on the market for 3 - 5 months. McCarty's place went under contract in one. Based on that data, I'd say he got a deal!

Note: We haven't opened the Minneapolis MSA on our free research page yet,
but we're about to, so call us if you want the research report for
anything in the Twin Cities area.UPDATE: Our Minneapolis Real Estate Report is available now.

Back in New York this week for the Real Estate Derivatives World shindig hosted by Terrapinn. I know. Paaartay!

It's actually exciting for us as we're beta testing new data products we've designed especially for the real estate derivatives traders. Here's a quick glimpse of the Altos 25-City Composite Price, which tracks the Radar Logic 25 markets and the Altos 10-City Composite Price, which tracks housing markets covered with the Case Shiller national Index.

Full product launch and details soon. If you're interested in the housing futures markets, we should be talking.

Link: Altos Real Estate Derivatives Data

Today's look inspired by conversations with a subscriber in Charlotte North Carolina. (In case you haven't noticed, we've started publishing the Charlotte Real Estate Reports now.)

Given the sorry state of the national housing market, how is Charlotte faring?

Let's look at some of the towns around Lake Norman: Huntersville, Cornelius, and Davidson.

At around $300,000, Huntersville and Cornelius are nice upscale markets in a pleasant part of the world. Davidson is a little higher-end and is showing some signs of weakening prices off about 5% from last autumn. Davidson also has the highest days-on-market measure for all three towns. At 140 days, these properties are definitely not flying off the shelves.

But as you can see from the price chart, home prices in this part of the country seem to be holding up. Why is that?

We see two common themes of housing markets avoiding the big crush this winter:

1. They're markets that didn't climb spectacularly high during the boom.
2. They're steady growth economies.

What's a steadily growing economy mean? Well for one thing, it means people are moving in to the area. Check this population chart from Ersys.

So the Charlotte area has those two things in it's favor. What's next? Where does the market go from here?

Like most of the country, home buyers are in no hurry in Charlotte. We measure relative demand levels with our Market Action Index. When this index drops below 30, we call it (ever optimistic) a "Buyer's Market". The lower this index goes, the lower the current levels of demand and the more likely you are to see home prices decline in the near future. I'm afraid on this point, our Charlotte area towns aren't faring any better than most of the country.

As we mentioned with Austin, Texas the other day, some markets haven't yet been hit by the big hammer. If we escape a painful recession, maybe home values in these markets don't collapse. Unfortunately there's nothing in the early numbers that indicate home prices will climb significantly from here in the near term.