Three leading articles appear below from The Matrix blog and NYT & WSJ today on poor housing numbers:

1. Read why Case-Schiller Index may not be a valid indicator for specific local markets

Excerpt from, "Funny thing is, Case Shiller Doesn’t Reflect The Washington, DC Metro Area Housing Market" In the Matrix, Jonathan Miller’s blog.

Here are the S&P/Case Shiller First Quarter 2011 results:
– National Index fell 4.2% from prior quarter
– 20-city Index fell 0.8% from February 2011 to March 2011 (8th monthly decline in a row)
– Washington, DC increased 1.1%, from prior quarter, the largest gain of all 20 cities tracked

Here is what you may not realize about the S&P/Case Shiller Home Price Index:
The index was developed for Wall Street to hedge the housing market, not as a monthly consumer metric
– Relatively easy to predict where the results will be in the next period – perhaps why it has not been widely traded by Wall Street and why the press release includes comments like “Home prices continue on their downward spiral with no relief in sight” since S&P/CSI can actually see the formation of future months’ results develop
– Based on a 3 month moving window of closed sales
– Washes out the annual seasons in housing
– Lags contract signing dates by 5-7 months (translation (Q1 2011 report = Q3 2010 contracts)
– Based on prices, not sales activity – yet sales trends can lead price trends by a year or more
– Comprised on single family sales. Excludes, condos, co-ops and new development sales.

06/01/11 wsj
2. Bottom May Be Near for Slide in Housing, NYT
How low can the market go? For real estate, some economists say, an end to the seemingly endless decline in housing values might be in sight. Not immediately. At the moment, prices are still dropping. In 20 large cities, prices fell 0.8 percent in March from the previous month, according to the Standard & Poor’s Case-Shiller Home Price Index released Tuesday. That pushed the closely watched index below its level of two years ago to a new post-bubble low, and put it 33.1 percent under its July 2006 peak.Few analysts expect housing prices to rebound anytime soon. But quite a few are predicting that the market is close to the moment when things will stop getting worse, which will be a major improvement all by itself.“By far the bulk of the downturn of housing prices is beyond us,” said Paul Dales of Capital Economics. He expects the market to slip 5 percent further, slightly more than he was expecting a few months ago. “There are some amazingly favorable signs. Housing is the most undervalued it’s been in 35 years,” Mr. Dales said. “At some point, it’s going to do very well.”
By David Streitfeld, June 1, 2011, NYT
Link to article

06/01/11 wsj

3. Housing Imperils Recovery, Home Prices Sink to 2002 Levels; Consumer Confidence Falls as Pessimism Grows, WSJ
Home prices have sunk to 2002 levels, effectively wiping out almost a decade’s worth of home equity across the U.S. and imperiling the fragile economic recovery as Americans confront the falling value of their biggest investment.A closely watched home-price index released Tuesday, the S&P/Case-Shiller National Index, showed that prices nationwide fell 4.2% in the first quarter after declining 3.6% in the fourth quarter of 2010. The index had seen increases in 2009 and early 2010."Home prices continue on their downward spiral with no relief in sight," said David M. Blitzer, chairman of S&P’s index committee. The report signals "a double dip in home prices across much of the nation," he said.That doesn’t bode well for the economy, which historically has depended on home buying and other consumer spending to rebound. Falling prices hurt economic growth in a number of ways. Not only do homebuyers curb spending when their homes are losing value, but continued price erosion keeps families stuck in homes they can’t sell because they are worth less than what they owe.
By S. Mitra Kalita and Nick Timiraos, June 1, 2011 WSJ
Link to article