Calomiris Discusses the U.S. Housing Market in Wall Street Journal

February 14, 2008

The Wall Street Journal featured an article entitled "When Home Values Don't Mesh," which discussed how difficult it is to get a clear picture of the U.S. housing market. In the article, Criterion affiliate Charles Calomiris provided insight on the future trend of home prices.

Difficulty arises in tracking home prices because the two best measures can predict opposite trends. Although Ofheo's index says home prices rose nationally by 1.8% between the third quarters of 2006 and 2007, the S&P/Case-Shiller national index of home prices was down 5.4% in the same period.

In spite of these difficulties, however, a trend is clear: house prices have stopped increasing in many places and, in some markets, they are now falling. Charles Calomiris, a Columbia University economist, cautioned that, "Too much weight is being attached to the Case-Schiller index. …Housing prices may not be falling as much as some economists say they are."

To read the article in full, click here.