BUSE Index Update: Trend-Spotting in the housing market

In my paper Trend-Spotting in the Housing Market I introduced the BUSE index which for the time period it was looked upon provided a forecasting of the Case-Shiller Composite US Housing Price Index and provided what I call behavioral support to the moving of prices. The index, expressing the ratio of buy to sell Google searches in the US Real Estate category, captured the crash of 2006 as well as the subsequent turnaround of home prices circa 2012.

The update BUSE index as of this writing shows that buyers and sellers have found a flat equilibrium of sorts in which appears to be just under 5 buyers for each 2 sellers.

The Case Shiller home price index meanwhile is climbing, while new homes are growing slowly. So what we are seeing is that home prices are past their 2006 bubble burst point but that the buyers/sellers pool has an almost constant (very slowly declining) BUSE index. This might be due to the fact that prices are mainly driven by existing home owners whose mortgages are just resurfacing after a protracted period of being underwater.