Changes in house prices have important consequences for the real economy as they aﬀectboth households’ wealth and their ability to borrow. Unlike the prices of other assets, suchas stocks and bonds, which are available almost instantaneously, house price indices arereported with lags of
. This delay is a signiﬁcant information friction withmeasurable eﬀects on important economic variables. We show, for example, that a releaseof the Case-Shiller house price index has an immediate eﬀect on the stock prices of homebuilding companies, despite the fact that this release contains information about housingmarket conditions from several months earlier.
If the stock market is not able to overcomethe reporting delays associated with house prices, it seems likely that individual homeowners,policy makers, lenders, etc. are as well, suggesting that this information friction may havemuch broader eﬀects on ﬁnancial markets and real economic activity.This delay in house price reporting emerges because once a buyer and seller have foundeach other and agreed on a sale price, there is little incentive for either party to publicizethe negotiated price. Even once the sale price is disclosed (by law) at the closing, which istypically a couple months following the sale agreement, there is another delay of a coupleadditional months before the public record becomes available.
In contrast, before a contractis signed, the seller has a strong incentive to broadcast the current oﬀering price, both as anadvertisement that the house is for sale as well as a signal to potential buyers of the likely priceat which the house can be purchased.
Thus, information on listing prices is disseminatedon internet platforms such as Multiple Listing Services (MLS) in essentially real time. Onsuch forums, when a sale agreement is reached, the listing is removed immediately. By usinginformation on the list prices of homes that are delisted, we can potentially learn about the
The Case-Shiller index, developed by Bailey et al.  and modiﬁed by Case and Shiller  andCase and Shiller , is the most widely followed measure of U.S. house price trends. The index iscalculated using repeated transactions of the same house so as not to be distorted by changes in the mix of homes sold over time.
For example, the Case-Shiller house price index summarizing sales prices that close in month
is notreleased until the end of month
See Chen and Rosenthal  for a discussion of the role of listing prices as a commitment device forsellers.