Market Update: March 2024

Published on
April 4, 2024

What Parcl Traders Need to Know

  • Tradable Parcl v3 markets finished March up 2.4% in aggregate (ppsft).
  • Several residential real estate markets experienced notable price increases MoM; Chicago (+6.9%), Atlanta (+6.9%), and Boston (+4.8%) stood out. The USA price feed grew 3.1% MoM.
  • On the other hand, Miami Beach (-3.1%), Brooklyn County (-1.2%), and Portland (-0.6%) were laggards. 
  • Chicago claims the best MoM performance (+6.9%) with Atlanta (+6.9%), followed by Boston (+4.8%).
  • Daily funding rates across Parcl markets are positive with a long bias amongst traders; notably, markets such as Miami Beach, San Francisco, and New York maintain the highest OI.

Parcl will have many more global locations coming soon! Stay tuned.

The State of Real-Time Real Estate Prices

Real estate market data for March shows variegated movements across several markets, with the overarching theme being an upswing in a majority of the cities. 

The average movement MoM across all tracked markets stands at 2.3%. The US price index remains on an ascendant path, marked by a 3.8% YTD and an even more robust growth of 9.4% YoY.

Source: Parcl Labs

Some residential real estate markets experienced meaningful price increases MoM. Notable declines were observed in markets such as Miami Beach, which saw -3.1% MoM, Brooklyn County -1.2% MoM, and New York falling -0.1%. Conversely, several markets exhibited strong positive growth; Both Chicago and Atlanta led with a remarkable +6.9% MoM increase, Boston followed with a +4.8% rise, and Los Angeles also posted a significant gain of +3.3%.

What Factors Are Driving Markets Generally?

In March, the real estate sector demonstrated robustness, with a notable uptick in the Housing Market Index and sustained home sales growth. This is attributed to growing confidence in the housing market's resilience, combined with strong job growth

A few indicators to keep an eye on:

  • Existing home sales in early 2024 saw a 9.5% increase due to sustained demand while pending home sales in February and March hinted at market stabilization.
  • The 30-year mortgage rates observed a fluctuating yet subtly declining trend. Starting the month at 6.88%, rates dipped to 6.74% in mid-March before slightly rising to 6.87% and then settling at 6.79% towards the month's end, resulting in an average rate of approximately 6.82% for March 2024.

The 15-year mortgage rates averaged 6.18%, experiencing minor fluctuations throughout the month, with a notable decrease to 6.11% by the end. This was a slight rise compared to February's average of 6.10%.

Chart of the Week

The index that tracks publicly traded companies involved in home construction is up over 12% YTD.

Source: Koyfin


As Q1 comes to an end, investors might want to consider: 

  • Historically, the March to August period marks the busy home-selling season, with prices typically appreciating in response to heightened demand. How should investors adjust their expectations for market performance and asset valuation in the coming quarters, given a boom in construction?
  • What are the implications of new multi-family supply outpacing demand on rental yields​?

What are Parcl traders doing?

Market sentiment among Parcl traders is balanced, though average funding rates are tilting fairly bullish (over 25% annualized). Notably, the highest positive sentiment is seen in Las Vegas, with a +0.1653% (58.4% annualized) funding rate. On the flip side, New York presents a negative sentiment and negative funding rate at 50.5% and -0.0362% (-10.95% annualized), respectively.

Source: Parcl

The total open interest across all Parcl markets is ~$320M, with total trader unrealized PnL standing at ~$-140K.

Disclaimer: This article has been written purely for educational purposes. This article is not intended to be investment advice of any kind.

Contributors
Parcl
Parcl Team
Subscribe to our newsletter
By subscribing you agree to with our Privacy Policy.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Share