It Isn't All Bad News About Home Prices

Though spotty, there may be an uptrend beginning in home prices in some areas, at least according to the Radar Logic (RPX) Home Price Index profiled here. This is a daily index of home prices in 25 Metropolitan Statistical Areas (MSA), and the composite of all 25 is not moving in either direction in a decisive way.

This index is computed daily, so we have a 1 day result, as well as compiled home price numbers for the last 7 day period, and again for the last 28 days. Here is today's chart for the data I used below. Granted, the overall time frame measured is less than a month, but one may see a developing trend in this index before any of the others even get around to compiling their data. Let's take an example of the Los Angeles, CA MSA to see how it works:

1 day = $311.92, 7 day = $296.43, and the 28 day = $295.42

As we can see, the number for the latest single day is the highest, with the 7 day number not as good, but better than the last 28 days. It appears that, in this time frame, the Los Angeles market's prices have been improving. 28 days does not a trend make, but could it be an early indicator?

What I did is to look at all the MSA's and find those that either showed all three numbers getting better in succession, or declining over the time period, as if you reversed the results in our example. That would show a short trend to the downside. Here are the other areas that show incremental increases along with Los Angeles:

• Atlanta, GA
• Columbus, OH
• Milwaukee, WI
• Minneapolis, MN
• Sacramento, CA
• New York, NY
• St. Louis, MO

The numbers declined in succession over the three measurement periods for:

• San Francisco, CA
• Miami, FL
• Phoenix, AZ
• San Diego, CA
• San Jose, CA
• Washington, DC

This is an index that hasn't been around for long, but you investors may want to check in on it at least weekly to watch the closest MSA for a sustained trend.