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Home Publications Blogs Beat the Press Rising Mortgage Rates Did Not Affect June Case-Shiller Data

Rising Mortgage Rates Did Not Affect June Case-Shiller Data

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Wednesday, 28 August 2013 07:31

The Washington Post seems to have made it a goal to get everything possible about the housing market wrong. Its article today on the Case-Shiller June price index attributed the slower price growth in part to higher interest rates. This makes no sense.

The Case-Shiller index is an average of three months data. The June release is based on the price of houses that were closed in April, May, and June. Since there is typically 6-8 weeks between when a contract is signed and when a sale is completed these houses would have come under contract in the period from February to May. This is a period before there was any real rise in interest rates.

 

FRED Graph

Interest rates first exceeded their winter levels at the end of May and then increased more in June and July. We will first begin to see a limited impact of higher interest rates in the Case Shilller index in the July data and the impact of the rise will not be fully apparent until the October index is released.

Comments (5)Add Comment
Missing Bubble
written by JayR, August 28, 2013 7:55
Talking about rising mortgage rates without talking about a new housing bubble is like talking about a persons slight health problem and leaving out the fact that they have fatal cancer with 6 months to live. Calling the end of a bubble is not easy but it is quite possible recent Wall Street plunges signal another popping. Popping now is probably much better then letting the bubble grow for a few more years.
It's Called Lazy
written by James, August 28, 2013 10:06
You are once again correct and didn't take you long to point that out. WAPO econ reporter and editor should have known better. They missed bc they were too lazy, thinking "that got to be it" bc all the media have been suggesting that including the NAR.

If they have caught a similar type of error by a school teacher or some manufacturer worker, they would screaming saying those are overly paid and need remedial training for even some of the basis analytical thinking.

WAPO - thank you for looking so dumb while always being the first to criticize others' mistakes!

What about what they don't write
written by D12345, August 28, 2013 3:01
Dean, Your stuff is great. But what about the sins of omission in the Times and the Post. Most important...TPP.
Nobody is discussing this. Most people don't even know about it. Krugman will go anywhere at all before touching this.
A treaty in secret negotiated exclusively by the .01%?? And the US trade officials have no barrier to immediately taking jobs with any of these corporations.

This is major!!
Let the editors know
written by Richard, August 31, 2013 12:04
Why doesn't Baker keep after the wash post editorials and op-Eds through more than his blog. He and a cadre of writers should be directing a flood of letters to letters to the editor and the Post's ombudsman. If a prestigious newspaper like the Post can't be factual, how can we expect citizens in a democracy to be well informed.
Flood the post's ombudsman
written by Richard, August 31, 2013 12:14
There must be another avenue to hold the Post accountable for their poor researched editorials and op-eds other than Bakers blog. How about a cadre of bright folks flooding the post's ombudsman with the facts.

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About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.

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