Realty Check
- Watch Foreclosures, Seriously
- Home Buyer Tax Credit Expansion Heads to Obama
- Congratulations America, We're All Landlords Now
- Wells Fargo Bets on Housing Recovery
- Home Buyer Tax Credit Done: Does it Matter?
- Better Times for Mortgage Banking
- 'Beleaguered Big Builders' Sitting On Piles of Cash
- Home Buyer Tax Credit: Final Deal?
- A Compromise on Home Buyer Tax Credit?
- Mortgage Bankers Can't Afford Their Own Home
- Tommy Lee, Medical Tourism and Nasty Santa, Your Emails
- U.S. Markets Gain 3% for the Week Despite 10.2% Unemployment
- Disney's 'Carol' Tests Widest 3-D Release Ever
- Stimulus II? Jobs Tax Credit=Cash For Clunkers
- Rockwell Automation Earnings: What Options Are Saying
- Gold Will Touch Higher Lows and Higher Highs: Analyst
- Is Misery Alive And Well in Your Office?
- Consumers Haven't Changed, They Are Just Pickier
- Watch Foreclosures, Seriously
- For the Jobless, 10% is Harder Than Before
- Week Ahead: Stocks Search for Catalyst in Quiet Week
- Outlook: Dollar Likely to Ride Higher on Bleak Jobs Report
- Buffett's Berkshire Hathaway Says Net Income Tripled
- Cramer: Earnings, IPOs Dominate Next Week
- Buying Fear: How to Own Volatility
- Administration Rejects Plan to Buy Fannie Mae Credits
- Consumers Haven't Changed —They Just Got Pickier
- Want the Homebuyer's Tax Credit? Here Are Some Tips
RSS FEED
Text Size 
CNBC Real Estate Reporter
A lot of folks are parsing the latest S&P Case Shiller home price report out today, and debating whether some month-to-month increases are proof of home price stabilization nationwide. I frankly think it’s impossible to say anything nationwide, because a lot of different markets are reacting very differently. That may seem an incredibly prosaic thing to say, but I think an awful lot of smart folks often lose sight of that.
I want to focus today on a couple of charts I got from John Burns over at John Burns Real Estate Consulting. He chooses to look at affordability and the Rental Gap (that is how much more or less it costs to own versus to rent) as better indicators of price direction.
First, take a look at the Rental gap:
As you can see, it is now far more economical to own in many of the formerly hot markets than it is to rent. “We're seeing payments now that are the best they've been since we've been tracking this and we've been tracking this since 1981,” says John Burns. “So all those people who maybe missed out on the boom couldn’t afford to buy a home when prices were what they were in 2005 can now get in and buy a home.”
Now look at affordability. This is a tricky chart, but fascinating:
Questions? Comments?
Data is a real-time snapshot *Data is delayed at least 15 minutes