Bearish data and Bullish Prospects?
Latest Zillow Research is publishing articles noting bearish data and bullish prospects.
Zillow Research recent title april floundering sales makes for a rather dire headline amongst articles that are usually edited by estate agents on commission.
You may remember, in the movie "The Big Short", hedge funds CDS protection buyers are posing as investors are being told that the market is getting into an itsybitsy little gully right now:
In April 2019, I noticed repricing between 14 Apr and 21 Apr on Zillow on selected houses that I follow in Dallas TX, Charlotte NC, Atlanta Ga. The prices in many cases went from Zestimate Mid to Low.
Florida seems unaffected for now. And the repricing seems to be very local.
It should be noted that this repricing occurred suddenly on many properties Zestimate, but the Zestimate history on the Zillow site does not show the 10% down jump.
Does this mean that there was a methodology change and those properties that went down had their price misrepresented?
Bull Case: Millennials coming of age
Fear not dear reader, Zillow Research also published an article claiming that a cohort of millennials is coming to the age of 34, which is the median home buying age... The bullish case by Zillow is based on demographic arguments: the median age of first home buyers is 34, and a larger cohort of millennials will reach this age soon.
Besides the demographics predicting a cohort of millennials aging, the evidence in terms of price is not there yet.
The argument makes an interesting case for further research, though this could be quite a project as the article mentions that demographics vary locally, and the buying age may need to be locally to reflect affordability.
Image credit: Ed Yourdon
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