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 November 25 , 2009 update: The latest results of the Moodys/REAL CPPI show a return of negative 3.9% in September for the all properties national index.

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Be aware that the Case Shiller Residential index has its own snafus which I feel are overestimating the values of homes (see "On the Latest Housing Numbers").  Credit losses will be pressuring home prices for the foreseeable future ("The Truth! The Truth? Banker's Can't Handle the Truth!!!")

 

 

The Moodys/REAL Commercial Property Index (CPPI) vs the S&P Case Shiller index? What does the correlation tell us about how conservative the valuations are in the latest REIT Forensic Analysis?

I have superimposed the MIT CPPI commercial property index over the Case Shiller residential property index, to illustrate the levered relationship CRE has to resdiential property values in California, where the subject of my most recent REIT analysis is concentrated. What can this tell us about the future of CRE prices? What does the residential default data prognosticate for home prices, and by extension, CRE prices? Well, let's find out.