{"id":196225,"date":"2023-01-10T18:04:00","date_gmt":"2023-01-10T23:04:00","guid":{"rendered":"https:\/\/ibkrcampus.eu\/trading-lessons\/home-price-index\/"},"modified":"2024-07-23T19:47:45","modified_gmt":"2024-07-23T19:47:45","slug":"home-price-index","status":"publish","type":"trading-lessons","link":"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/","title":{"rendered":"Home Price Index"},"content":{"rendered":"
\n
\n
\n

Home prices are a hot topic among investors because real estate has a huge impact on consumer sentiment and more broadly, gross domestic product. Home price data, is provided by various organizations, but one significant provider is S&P Global, which maintains the CoreLogic Case-Shiller Index. The data is available in three versions. The 10- and 20-metropolitan areas indices and a national version index. S&P Global observes single-family homes that have been sold repeatedly with arms- length transactions. The first sales price and the second sales price for the same property are referred to as \u201cpairs.\u201d The difference with each pair is used to calculate changes in real estate values within the respective areas. S&P Global releases the data on the last Tuesday of each month at 9:00am eastern time. S&P Global provides home price data to help governments, financial institutions, corporates and market participants forecast, analyze and plan for current and future economic developments.<\/p>\n

Changes in home prices can provide valuable insight into the economy. When home prices increase, homeowners perceive that their finances are improving, which in turn strengthens consumer sentiment. As sentiment improves, consumers are more likely to buy goods and splurge on entertainment and other services. Weakening real estate prices, of course, have the opposite effect. When real estate prices declined in the U.S. during the 2008 financial crisis, it corresponded with slowing economic growth, slower consumer spending and weakness across many economic data points.<\/p>\n

\n
\n
\n

\"\"Price changes are also a broad indication of the overall economy, because economic growth often strengthens the labor market and wages. With higher incomes, individuals are more likely to purchase homes and this increase in demand can cause prices to climb. Home purchases can also have a ripple effect within the economy. New homeowners typically purchase furniture, appliances, kitchen items, landscaping supplies and various other items. A strong real estate market as illustrated by home prices can also imply increased demand for mortgages, which support bank earnings. In a similar manner, a strong real estate market can cause home builders to increase construction, which may require them to hire additional workers.<\/p>\n

The desire for homebuilders to supply housing, demand for housing from consumers, and the cost of capital and materials are important variables to analyze when looking at real estate markets. To forecast housing prices look at homebuilder sentiment, home sales, expected credit conditions, mortgage applications, and daily commodity prices to get an idea of how builders, banks, consumers and investors feel about the trajectory of the real estate market. Also, look at the price action and listen to the conference calls of some of the largest real estate builders, operators and providers. KB Home, Toll Brothers, Lennar, DR Horton, AvalonBay, Equity Residential, Essex Property Trust, Builders FirstSource, Lowe\u2019s and NVR are some to pay attention to.<\/p>\n

\n
\n
\n

While not typically a market moving data release, the market will decline further if home prices are worse than expected, and rise more if better than expected. Higher home prices means greater purchasing power, more economic activity and an environment that will likely benefit stocks globally.<\/p>\n

For a large portion of the world\u2019s population, buying a home is the single largest transaction they\u2019ll ever make. Tracking the capital intensive and interest rate sensitive real estate sector for signs of economic strength or weakness is an important aspect of economic analysis.<\/p>\n<\/div>\n<\/div>\n<\/div>\n

 <\/p>\n

Additional Resources<\/strong><\/p>\n

Most recent Home Price Index data release<\/a><\/p>\n

Home Price Index explained<\/a><\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

The Home Price Index lesson discusses where to find it, how to forecast it, how it\u2019s influenced, and how it influences financial markets and the economy. As a capital-intensive industry with high interest rate sensitivity, real estate requires the coordination of many moving parts of the economy. An essential part of economic analysis involves tracking the capital-intensive and interest rate-sensitive real estate sector for signs of economic strength or weakness.<\/p>\n","protected":false},"author":850,"featured_media":196241,"parent":0,"comment_status":"open","ping_status":"closed","template":"","meta":{"_acf_changed":true,"footnotes":""},"contributors-categories":[149],"traders-academy":[100,103,105],"class_list":["post-196225","trading-lessons","type-trading-lessons","status-publish","has-post-thumbnail","contributors-categories-interactive-brokers","traders-academy-beginner-trading","traders-academy-level","traders-academy-trading-lesson"],"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"\nArchives | Traders' Academy | IBKR Campus<\/title>\n<meta name=\"description\" content=\"The Home Price Index lesson discusses where to find it, how to forecast it, how it\u2019s influenced, and how it influences financial markets and the economy.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.interactivebrokers.com\/campus\/wp-json\/wp\/v2\/trading-lessons\/196225\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Home Price Index\" \/>\n<meta property=\"og:description\" content=\"The Home Price Index lesson discusses where to find it, how to forecast it, how it\u2019s influenced, and how it influences financial markets and the economy.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/\" \/>\n<meta property=\"og:site_name\" content=\"IBKR Campus EU\" \/>\n<meta property=\"article:modified_time\" content=\"2024-07-23T19:47:45+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.interactivebrokers.eu\/campus\/wp-content\/uploads\/sites\/3\/2023\/01\/home-price-index.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1280\" \/>\n\t<meta property=\"og:image:height\" content=\"720\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\n\t \"@context\": \"https:\\\/\\\/schema.org\",\n\t \"@graph\": [\n\t {\n\t \"@type\": \"WebPage\",\n\t \"@id\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/trading-lessons\\\/home-price-index\\\/\",\n\t \"url\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/trading-lessons\\\/home-price-index\\\/\",\n\t \"name\": \"Home Price Index - IBKR Campus EU\",\n\t \"isPartOf\": {\n\t \"@id\": \"https:\\\/\\\/ibkrcampus.eu\\\/campus\\\/#website\"\n\t },\n\t \"primaryImageOfPage\": {\n\t \"@id\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/trading-lessons\\\/home-price-index\\\/#primaryimage\"\n\t },\n\t \"image\": {\n\t \"@id\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/trading-lessons\\\/home-price-index\\\/#primaryimage\"\n\t },\n\t \"thumbnailUrl\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/wp-content\\\/uploads\\\/sites\\\/3\\\/2023\\\/01\\\/home-price-index.jpg\",\n\t \"datePublished\": \"2023-01-10T23:04:00+00:00\",\n\t \"dateModified\": \"2024-07-23T19:47:45+00:00\",\n\t \"description\": \"The Home Price Index lesson discusses where to find it, how to forecast it, how it\u2019s influenced, and how it influences financial markets and the economy.\",\n\t \"breadcrumb\": {\n\t \"@id\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/trading-lessons\\\/home-price-index\\\/#breadcrumb\"\n\t },\n\t \"inLanguage\": \"en-US\",\n\t \"potentialAction\": [\n\t {\n\t \"@type\": \"ReadAction\",\n\t \"target\": [\n\t \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/trading-lessons\\\/home-price-index\\\/\"\n\t ]\n\t }\n\t ]\n\t },\n\t {\n\t \"@type\": \"ImageObject\",\n\t \"inLanguage\": \"en-US\",\n\t \"@id\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/trading-lessons\\\/home-price-index\\\/#primaryimage\",\n\t \"url\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/wp-content\\\/uploads\\\/sites\\\/3\\\/2023\\\/01\\\/home-price-index.jpg\",\n\t \"contentUrl\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/wp-content\\\/uploads\\\/sites\\\/3\\\/2023\\\/01\\\/home-price-index.jpg\",\n\t \"width\": 1280,\n\t \"height\": 720,\n\t \"caption\": \"home price index\"\n\t },\n\t {\n\t \"@type\": \"BreadcrumbList\",\n\t \"@id\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/trading-lessons\\\/home-price-index\\\/#breadcrumb\",\n\t \"itemListElement\": [\n\t {\n\t \"@type\": \"ListItem\",\n\t \"position\": 1,\n\t \"name\": \"Home\",\n\t \"item\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/\"\n\t },\n\t {\n\t \"@type\": \"ListItem\",\n\t \"position\": 2,\n\t \"name\": \"Academy Lessons\",\n\t \"item\": \"https:\\\/\\\/www.interactivebrokers.eu\\\/campus\\\/trading-lessons\\\/\"\n\t },\n\t {\n\t \"@type\": \"ListItem\",\n\t \"position\": 3,\n\t \"name\": \"Home Price Index\"\n\t }\n\t ]\n\t },\n\t {\n\t \"@type\": \"WebSite\",\n\t \"@id\": \"https:\\\/\\\/ibkrcampus.eu\\\/campus\\\/#website\",\n\t \"url\": \"https:\\\/\\\/ibkrcampus.eu\\\/campus\\\/\",\n\t \"name\": \"IBKR Campus EU\",\n\t \"description\": \"\",\n\t \"potentialAction\": [\n\t {\n\t \"@type\": \"SearchAction\",\n\t \"target\": {\n\t \"@type\": \"EntryPoint\",\n\t \"urlTemplate\": \"https:\\\/\\\/ibkrcampus.eu\\\/campus\\\/?s={search_term_string}\"\n\t },\n\t \"query-input\": {\n\t \"@type\": \"PropertyValueSpecification\",\n\t \"valueRequired\": true,\n\t \"valueName\": \"search_term_string\"\n\t }\n\t }\n\t ],\n\t \"inLanguage\": \"en-US\"\n\t }\n\t ]\n\t}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Archives | Traders' Academy | IBKR Campus","description":"The Home Price Index lesson discusses where to find it, how to forecast it, how it\u2019s influenced, and how it influences financial markets and the economy.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.interactivebrokers.com\/campus\/wp-json\/wp\/v2\/trading-lessons\/196225\/","og_locale":"en_US","og_type":"article","og_title":"Home Price Index","og_description":"The Home Price Index lesson discusses where to find it, how to forecast it, how it\u2019s influenced, and how it influences financial markets and the economy.","og_url":"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/","og_site_name":"IBKR Campus EU","article_modified_time":"2024-07-23T19:47:45+00:00","og_image":[{"width":1280,"height":720,"url":"https:\/\/www.interactivebrokers.eu\/campus\/wp-content\/uploads\/sites\/3\/2023\/01\/home-price-index.jpg","type":"image\/jpeg"}],"twitter_card":"summary_large_image","twitter_misc":{"Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/","url":"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/","name":"Home Price Index - IBKR Campus EU","isPartOf":{"@id":"https:\/\/ibkrcampus.eu\/campus\/#website"},"primaryImageOfPage":{"@id":"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/#primaryimage"},"image":{"@id":"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/#primaryimage"},"thumbnailUrl":"https:\/\/www.interactivebrokers.eu\/campus\/wp-content\/uploads\/sites\/3\/2023\/01\/home-price-index.jpg","datePublished":"2023-01-10T23:04:00+00:00","dateModified":"2024-07-23T19:47:45+00:00","description":"The Home Price Index lesson discusses where to find it, how to forecast it, how it\u2019s influenced, and how it influences financial markets and the economy.","breadcrumb":{"@id":"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/"]}]},{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/#primaryimage","url":"https:\/\/www.interactivebrokers.eu\/campus\/wp-content\/uploads\/sites\/3\/2023\/01\/home-price-index.jpg","contentUrl":"https:\/\/www.interactivebrokers.eu\/campus\/wp-content\/uploads\/sites\/3\/2023\/01\/home-price-index.jpg","width":1280,"height":720,"caption":"home price index"},{"@type":"BreadcrumbList","@id":"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/home-price-index\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.interactivebrokers.eu\/campus\/"},{"@type":"ListItem","position":2,"name":"Academy Lessons","item":"https:\/\/www.interactivebrokers.eu\/campus\/trading-lessons\/"},{"@type":"ListItem","position":3,"name":"Home Price Index"}]},{"@type":"WebSite","@id":"https:\/\/ibkrcampus.eu\/campus\/#website","url":"https:\/\/ibkrcampus.eu\/campus\/","name":"IBKR Campus EU","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/ibkrcampus.eu\/campus\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"}]}},"_links":{"self":[{"href":"https:\/\/ibkrcampus.eu\/campus\/wp-json\/wp\/v2\/trading-lessons\/196225","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ibkrcampus.eu\/campus\/wp-json\/wp\/v2\/trading-lessons"}],"about":[{"href":"https:\/\/ibkrcampus.eu\/campus\/wp-json\/wp\/v2\/types\/trading-lessons"}],"author":[{"embeddable":true,"href":"https:\/\/ibkrcampus.eu\/campus\/wp-json\/wp\/v2\/users\/850"}],"replies":[{"embeddable":true,"href":"https:\/\/ibkrcampus.eu\/campus\/wp-json\/wp\/v2\/comments?post=196225"}],"version-history":[{"count":0,"href":"https:\/\/ibkrcampus.eu\/campus\/wp-json\/wp\/v2\/trading-lessons\/196225\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ibkrcampus.eu\/campus\/wp-json\/wp\/v2\/media\/196241"}],"wp:attachment":[{"href":"https:\/\/ibkrcampus.eu\/campus\/wp-json\/wp\/v2\/media?parent=196225"}],"wp:term":[{"taxonomy":"contributors-categories","embeddable":true,"href":"https:\/\/ibkrcampus.eu\/campus\/wp-json\/wp\/v2\/contributors-categories?post=196225"},{"taxonomy":"traders-academy","embeddable":true,"href":"https:\/\/ibkrcampus.eu\/campus\/wp-json\/wp\/v2\/traders-academy?post=196225"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}