~Welcome to the Econo-Almanac~

I started this website in mid-2004 to chronicle San Diego’s spectacular housing bubble.  The purpose of the site remains, as ever, to provide objective and evidence-based analysis of the San Diego housing market. A quick guide to the site follows:

  • New visitors are advised to begin with the Bubble Primer or (if wondering about the site name) the FAQ list.
  • Housing articles I’ve written are found in the main section below.
  • Discussion topics posted by site users are found in the “Active Forum Topics” box to the lower right.
  • This website is an avocation; by day I help people with their investments as a financial advisor*.  Market commentary, an overview of our investment approach, and more can be found on my firm's website.

Thanks for stopping by…

No Double Dip For San Diego Yet

Submitted by Rich Toscano on June 1, 2011 - 12:04pm
The median price data had indicated some home price stabilization through March, but the latest release of the Case-Shiller index suggests otherwise.  I'll talk a bit more below about the strengths and weaknesses of the CS index, but first let's have a look at the latest data.

The media has made much of the fact that the national Case-Shiller index hit a new post-boom low, officially ushering in a "double dip" in nationwide home price.  But while San Diego prices did drop in March,  the CS index indicates that we still held up above those 2009 lows:

(more charts plus some thoughts on the Case-Shiller index below)

continue reading at voiceofsandiego.org

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Job Market Faltered in April

Submitted by Rich Toscano on May 20, 2011 - 5:27pm
The California Employment Development Department's latest estimates indicate that, after adjusting for seasonal factors, San Diego employment declined slightly in April.  The EDD also revised the estimate of March employment downward.

Between the March revision and the April decline, there has been effectively no job growth since February:

continue reading at voiceofsandiego.org

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April 2011 Resale Data Rodeo

Submitted by Rich Toscano on May 11, 2011 - 4:42pm
The median price per square foot of San Diego resale homes was somewhat mixed last month: up .2% for single family homes, but down 1.7% for condos, and down .3% in aggregate.

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Low-Priced Home Whackage in February's Case-Shiller Index

Submitted by Rich Toscano on April 26, 2011 - 6:44pm

Home price data that is more timely than the Case-Shiller index has suggested that San Diego prices, on the whole, may be undergoing a bit of a spring thaw.  So I don't make too much of the fact that February's Case-Shiller index (which is calculated based on sales that took place in December, January, and February) declined by 1.3 percent in aggregate.

It is interesting, however, that the low-priced tier of the index dropped as much as it did.  After weathering the recent fall/winter lull better than the other tiers, the low-priced homes were spanked for 2.7 percent in February.  The middle tier was down 1.4 percent and the high tier by .5 percent for the month.

continue reading at voiceofsandiego.org

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Blast from the Past: Revisiting Moody's and Forbes' Colossally Inept 2006-Era Housing Forecast

Submitted by Rich Toscano on April 23, 2011 - 10:54am

Remember when housing started to falter back in 2006, and the mainstream economists' version of bearish tough talk was to predict that prices might just go up slightly less quickly in the future?

Tim of the always amusing Seattle Bubble blog recently dug up a prime example of that very thing, wherein Forbes magazine sternly informed readers:

"Get used to it--the seller's market is closing up shop."


"Now the question is more how hard is it going to land..."

Wow, that's some fairly bearish-sounding rhetoric.  I guess that's why Forbes' teamed up with Moody's to determine that prices would... pretty much just keep going up. (Fun graphs after the jump...)
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PCA 2010 Investment Performance

Submitted by Rich Toscano on April 18, 2011 - 10:28am
Pacific Capital Associates, the investment advisory firm of which I am co-owner, has just completed the independent verification of our investment performance through 2010.  The chart below indicates returns for our average discretionary managed portfolio since mid-2004, when we first got the ability to start tracking these numbers in a verifiable manner:

The thing that I am most pleased about with the 2010 performance is not the fact that we slightly outperformed the market (as measured by the S&P500) for the year, but that we did so while taking substantially less risk (notably, the average client account was down less than half as much as the market during the big Q2 correction).  More numbers and statistics, as well as loads of fun disclosures, can be found in our official investment track record.

More background on the above chart or the firm can be found in the post imaginatively titled My Day Job.

Things I am obliged to mention:
- Returns include reinvestment of all income. 
- Past performance is not indicative of future results.
- Investment advisory services and securities offered through Girard Securities, Inc., member SIPC/FINRA.

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San Diego's Job Recovery Strengthens

Submitted by Rich Toscano on April 16, 2011 - 10:28am
March was good to San Diego's job market, according to the Employment Development Department's latest estimates. 

San Diego employment was estimated to have risen by .8 percent for the month, which the following chart shows is actually fairly brisk for recent times:

continue reading at voiceofsandiego.org

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March 2011 Resale Data Rodeo

Submitted by Rich Toscano on April 12, 2011 - 9:56am
The median price per square foot for San Diego homes rose for the second time in a row in March.  This price measure was up .3% for detached homes, 4.8% for attached homes, and 1.6% in aggregate.  The detached home series is the most reliable of the three, so any actual price increases were probably muted -- nonetheless, prices look to have increased for a second month in a row.

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Across-the-Board Declines in January's Case-Shiller Index

Submitted by Rich Toscano on April 7, 2011 - 10:10am
As always, the Case-Shiller index of home prices arrives with a fairly major lag... 

continue reading at voiceofsandiego.org

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Employment Improves in the New Year

Submitted by Rich Toscano on March 28, 2011 - 1:36pm
Because the January and February job numbers were released so close together, I decided to just cover them both in one update.  I'm going to jump right in with the seasonally adjusted data, because unadjusted January employment is always very distorted due to temporary holiday jobs disappearing.

Total seasonally adjusted San Diego employment increased slightly in the two months since December, growing by 5,700 jobs or about .5 percent during that time.

continue reading at voiceofsandiego.org

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February 2011 Resale Housing Data Rodeo

Submitted by Rich Toscano on March 17, 2011 - 5:50pm
Last month, the median price per square foot of existing homes sold in San Diego rose notably -- by 2.2 percent for single family homes, 2.5 percent for condos, and 2.4 percent in aggregate:

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Buy a House Now? It Depends...

Submitted by Rich Toscano on February 27, 2011 - 3:31pm
Last week I discussed housing valuations -- how expensive local homes are in comparison to their historical relationship with rents and incomes.  To sum up the conclusions, San Diego homes in aggregate are right in the middle of the valuation range that has prevailed for the past thirty-odd years.  However, due to super-low mortgage rates, monthly payments on San Diego homes are substantially below their typical historical levels.

This article will deal with whether it makes sense, financially speaking, to buy a home in a market characterized by middle-of-the-road prices alongside dirt-cheap monthly payments.
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Case Shiller Index Declines Slightly in December

Submitted by Rich Toscano on February 23, 2011 - 7:55pm
I know I said my next piece would discuss the circumstances in which it makes sense to buy a house.  I need to stop promising that I'll discuss something in the "next" blog entry, because often a quicker and newsier topic intervenes.

In this case that would be the latest release of the Case-Shiller index, which takes place on the last Tuesday of each month.  (Yes, I really should have seen this coming before declaring what the next topic would be).

continue reading at voiceofsandiego.org

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Shambling Towards Affordability: Year-End 2010 Edition

Submitted by Rich Toscano on February 14, 2011 - 6:32pm
It's time for some valutions.  The charts below show San Diego housing valuation ratios updated through year-end 2010.

Let's start with the price-to-income ratio.  The decline in home prices since the summer brought this ratio back down to 7.6 -- right in the middle of fair value territory per these ratios.  In fact, it's 5% below the median price-to-income ratio over this entire period (which incidentally is 8 on the nose).

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January 2011 Resale Housing Data Rodeo

Submitted by Rich Toscano on February 7, 2011 - 8:44pm

Well, it's 2011, and yet I am still lacking the following:
  • laser eyes
  • hyper-evolved glasses-wearing chimp assistant
  • self-aware email client
  • minotaur
  • huffable bacon
  • tank full of precogs to help me match my outfits
Someone please tell science to get on it.  For now, we'll have to make do with the January resale data.

The median price per square foot took a bit of a beating last month: down 3.0 percent for detached homes, 7.2 percent for condos, and 4.5 percent in aggregate:

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