Saturday, June 16, 2018

Miami Housing Market Continues on Bullish Upswing Path

- Intended for Students/New Analysts to Learn Analytics -

(Click on the image to enlarge)
Generally, these two charts - normal and normalized - project very similar trends. In this case, they are at considerable variance.

The Monthly Median Price trend has tapered, remaining directionless since October and without forming any meaningful support. The reason the primary trendline is diverging from the moving average is that both peaks (#7 and #8) and troughs (#10 and #11) are formed by two successive data points in conformity with the 2-Mo MA.  

On the other hand, the normalized SPSF continues a bullish upward trend, breaking out of the $185-$195/SF congestion, even eclipsing the $195 resistance. Both trendlines are confirming the upward trend, as well as the breakout, creating an all-out bullish scenario.

Again, although tracking the Monthly Median Sale Prices is the industry standard, it must be studied alongside the normalized trend to make informed business decisions. 

While constructing the SPSF trend, one must make sure that the Bldg SF (Net / Heated) remains well within the 4-5% margin. In the Miami example, the monthly SFs ranged between 1,563 and 1,668, around the overall median of 1,619 (well within the 4% range).

Note: This analysis covers the City of Miami, not Miami-Dade county. 

- Sid Som, MBA, MIM
President, Homequant, Inc.

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