REPOST: Housing Market Blows Hot and Cold

 Is the endless snow affecting the housing market? This article from Bloomberg View explains the seasonal trends in housing sales.

THIS ONE HAS GREAT CURB APPEAL. | Image Source: bloombergview.com

The northern third of the U.S. is locked in a straitjacket of snow, ice and bleak weather better suited to staying at home than going out and hunting for a new one. I can almost hear it now: Remember how awful last year’s polar vortex was for the fledgling housing-market recovery? Looks like we're in for more of the same this year.

Except that this construct reflects a significant misunderstanding about the practical nature of housing sales. Homebuyers who decide not to view property during a bout of cold weather don't drop out of the market. They just delay their search until the weather becomes more agreeable, usually in a few weeks or months at most.

Consider the chart below, which uses the average temperature of the 48 contiguous states from the National Oceanic and Atmospheric Administration and the number of non-seasonally adjusted existing home sales from the National Association of Realtors. Notice anything? The seasonal trends are remarkably in sync: Housing sales rise in warm weather and fall in cold weather no matter the availability of credit, what direction interest rates are moving or the extent of wage and job growth.

Image Source: bloombergview.com

The reality is that housing sales are seasonal -- always have been, always will be.

Here's where things can get confusing, though.

Most national housing studies, such as those by the NAR, emphasize a month-over-month analysis of seasonally adjusted numbers. Throw in a federal housing-stimulus plan or a change in housing tax policy and those seasonal adjustments distort the market trends.

Other reports, such those by S&P/Case Shiller and CoreLogic, are based on a methodology that essentially strips away seasonal trends. That's a key reason those reports feel out of step with actual market patterns. 

Over the years I’ve had conversations with a number of well-respected economists about the virtues of their seasonal-adjustment methodologies. Yet consumers and real-estate brokers have a very different perspective and see the housing market as a series of “waves.” That probably is a more accurate representation of what's going on.

And that’s pretty cool.

Learn more about the US housing market by following this Galloway Custom Homes Google+ page.

Energy-efficient building materials for houses

Image Source: inhabitat.com

Energy-efficient houses are environment friendly and economically sustainable. Although they may initially dictate higher costs, energy-efficient materials can help home owners recover easily as they provide improvements in electricity, water heating, or space heating and cooling. Experts in energy conservation agree that investing on these materials will yield good returns.

For those who plan on building or renovating their homes for energy efficiency, below are some materials to consider:

Straw Bales. A byproduct of the grain industry, studies show that Straw Bales, if kept dry, can last for thousands of years and provide good insulation.

Cool roofing. Designed to reflect more sunlight and absorb less heat than a standard roof, cool roofing can help homeowners reduce energy bills by decreasing air conditioning needs. Moreover, it also improves indoor comfort for spaces and decreases roof temperature, which may extend roof service life.

Image Source: greenupgrader.com

Recycled wood and plastic composite lumber. Adding extra strength to houses, studies show that a 50-50 combination of wood fibers and waste plastics is more durable and less toxic than conventional treated lumber.

Plant-based Polyurethane Rigid Foam. Manufactured using foam from materials such as bamboo and hemp, this type of material possesses higher moisture and heat resistance, which are excellent acoustics and protection against mold and pests. Furthermore, it also has a higher thermal resistance and insulates better than other conventional materials.

Image Source: ecobuildingpulse.com

With its mission to provide clients quality and comfortable homes, Tom Galloway Custom Homes has successfully positioned itself as the leading homebuilder on the Lakeshore at the People’s Choice Awards for the impeccable attention to detail the company’s artisans have given to every project. For information about the company, visit this website.