The Real Estate Channel

There They Go Again...Again

I’m in the process of writing another book, going into great depth regarding one of the most important things discussed in my book The Most Important Thing: cycles, their causes, and what to do about them. It will be out next year, but this memo will give you a preview regarding one of the most important cyclical phenomena.

2017 Update: Median Home Price and Salary Required in 27 Major Cities

Keith Gumbinger, Vice President at, features a periodic update entitled "The Salary You Must Earn to Buy a Home in 27 Metros". The key question is:

"How much salary do you need to earn in order to afford the principal and interest payments on a median-priced home in your metro area?"

July 2017 Market Commentary

It is stinking hot and steamy on the East Coast these days, as the proverbial “dog days of summer” set in. Historically, this was a time of year when things slowed down, people went on vacation, and it was generally too hot to move fast, but not this year.

Dynamic Asset Allocation for Practitioners Part 1: Universe Selection

In 2012 we published a whitepaper entitled “Adaptive Asset Allocation: A Primer” in which we built upon the simple, robust momentum framework proposed by Mebane Faber in his 2009 study “Relative Strength Strategies for Investing.”

Bronfman Rothschild 2017 Q2 Review

Supply and demand seems to have been placed on the backburner in today’s world of prognosticating inflation, employment, and GDP. The first point is the supply of publicly traded stock in the US. The second point is the supply of money.

June New Home Sales Inches Up

This morning's release of the June New Home Sales from the Census Bureau came in at 610K, up 0.8% month-over-month from a revised 605K in May. Seasonally adjusted estimates for back to March were also revised. The forecast was for 615K.

Home Prices Rose 5.6% Year-over-Year NSA in May

With today's release of the May S&P/Case-Shiller Home Price Index, we learned that seasonally adjusted home prices for the benchmark 20-city index were up 0.1% month over month. The seasonally adjusted national index year-over-year change has hovered between 4.2% and 5.8% for the last twenty-seven months. Today's S&P/Case-Shiller National Home Price Index (nominal) reached another new high.

FHFA House Price Index: Real Index Level Last Seen in August 2007

The Federal Housing Finance Agency (FHFA) has released its U.S. House Price Index (HPI) for May. U.S. house prices were up 0.4 percent on a seasonally adjusted nominal basis from the previous month. Year-over-year the index is up 6.9% (nonseasonally adjusted). Seasonally adjusted, the index is up 5.65% year-over-year.

Existing-Home Sales: June Sales Slip

This morning's release of the June Existing-Home Sales decreased from the previous month to a seasonally adjusted annual rate of 5.52 million units. The consensus was for 5.58 million. The latest number represents a 1.8% decrease from the previous month and a 0.7% increase year-over-year.

How Conservative Should Investors Be Given Economic and Market Conditions?

We have created an adaptive regime-based investment framework that generates multi-asset and equity-sector-rotation model portfolios. The investment objective of these model portfolios is to combine downside protection with upside participation. Many firms say they do this – but our process integrates macroeconomic and financial cycle risk.

“Mother of All Bubbles” Keeps Gold in Focus

Today I want to discuss reports that global debt levels are at all-time highs, and what this means for your investment decisions going forward.

Secular Trends in Residential Building Permits and Housing Starts

Over the long haul the two series offer a compelling study of trends in residential real estate. Here is an overlay of the two series since the 1959 inception of the Starts data and the Permits data, which began being tracked a year later. The monthly data points are preserved as faint dots. The trends are illustrated with 6-month moving averages of data divided by the Census Bureau's mid-month population estimates.

Sizing Up Markets—and Your Investment Strategy

Today’s risks are clear: stock valuations are high, credit spreads are tight and interest rates remain low. A modest tilt toward return-seeking assets still makes sense. But investors should also be willing to look beyond traditional stocks and bonds.

New Residential Housing Starts Up in June

The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for June new residential housing starts. The latest reading of 1.215M was above the forecast of 1.155M. Figures going back to April were revised.

New Residential Building Permits: June Bounces Back

The U.S. Census Bureau and the Department of Housing and Urban Development have now published their findings for June new residential building permits. The latest reading of 1.254M was an increase from 1.168M in May and above the forecast of 1.200M.