Markets & Economy

Schizophrenic market conditions zap Trulia’s ‘Housing Barometer’

Improving home sales and foreclosure rates have outpaced construction growth

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Here's one sign that today's housing recovery is not your average rebound. Trulia has decided to scrap its "Housing Barometer" because it says the metrics that the index uses to gauge the market recovery -- ones that might normally provide a telling snapshot of its health -- no longer mesh together to produce an easily digestible picture. That's because the three metrics that the indicator uses -- construction starts, existing-home sales, and the delinquency and foreclosure rate -- show seemingly schizophrenic symptoms that confound the index's ability to diagnose the market's health. Why is it that today's market, were it a human patient, might be prescribed antipsychotics? What's throwing the index off is that improvements in existing-home sales and delinquency and foreclosure rates have far outpaced improvement in construction. "When we titled the first Housing Barometer post 'Are we there yet?' the answer was clearly 'no.' Now, 'Are we there yet?' is no longer a yes...