Housing Prediction Markets

John Whitehead at Hypothetical bias has some excerpts from recent articles on how players in housing prediction markets view a couple of major real estate markets (like New York San Franciso, etc...):

San Diego? Prices will rise another 5 percent in the third quarter, according to the bettors at HedgeStreet, another Web site. New York? They will inch up 2 percent. In Los Angeles, they will jump 7 percent. In each of the cities, as in San Francisco, prices will be more than 10 percent higher than they had been a year earlier.

HedgeStreet began accepting bets this year on house values in a handful of major cities. In the weeks leading up to the release of new numbers from the National Association of Realtors, bettors can buy contracts that make a payout according to a metropolitan area's average price.

Click here for the whole thing (note: the original NYT article Whitehead mentions is available only if you have an online subscription).

Here's a link to the Hedgestreet contracts.