Wikinvest Wire

More record home price declines

Tuesday, January 27, 2009

The November report(.pdf) for the S&P Case-Shiller Home Price Indices shows the 10-City index equaling the previous month's record annual decline of 19.1 percent and the 20-City index down 18.2 percent, a new record. Price indices for all 20 cities are shown below.
Recall that to aid in viewing this graphic, the order of the legend (upper left) reflects the top-to-bottom position of all 20 cities for the current month (far right).

Phoenix, Las Vegas, and San Francisco maintain their pace of 30+ percent annual declines as indicated in red below.

Last month, Tampa joined the list of metro areas with declines of 20 percent or more as indicated in blue, while Washington looks ready to join that club in the months ahead.
IMAGE David M. Blitzer, Chairman of the Index Committee at Standard & Poor's, noted:

The freefall in residential real estate continued through November 2008. Since August 2006, the 10-City and 20-City Composites have declined every month – a total of 28 consecutive months.

Every region was down in excess of 1% for the November/October period, with eight of the regions recording record monthly declines. Phoenix and Las Vegas were the worst performers for the month at -3.4% and -3.3%, respectively, and also have the lowest returns over the one-year period, returning -32.9% and -31.6% respectively. Overall, more than half of the metro areas had record annual declines.
Both the 10-city and 20-city home price indices are now back to 2004 levels.

4 comments:

Anonymous said...

Tim,

Watching the price declines here and Detroit is such an interesting anomaly. Interesting to see what happens when industry and people flee an area.

Also thinking that San Jose will see a flight of jobs from such a insanely high cost area. I think a lot of that is reflected in tech performance. The layoff situation may only get worse.

If you feel like it, graphs of population flight might give us a more dynamic picture or what will happen to home prices. Population flight, employment filght and bad tax policy will probably cause SF and LA to crater over the next couple of years.

Wondering how much ghost inventory is forming with this large of a decline? With the HELOC data and the sales data, we might be able to get an idea on the total number of underwater borrowers. Guestimate on some rate of failure and that would give us an idea of how long price supression would last.

I think part of the stickiness in the beach areas comes from the move up buyers. While they got butchered on equity, I think many debt ratios are not as bad. They will hang on for a long time, to keep their perceived gains intact.

Thanks,
James/LAEF2

Anonymous said...

When I sold my So Cal home in 2004, my guess was the value was about 25% to high by historical measures. Boy was I wrong up to this point! Lets see if in the long run I was not that far off.

MiamiCondoForum DotCom said...

Miami will win this war. I stake my reputation as a real estate crash blogger on it! The only reason Miami is ranked a pathetic number 3 (in home price decline from peak) is that we have a deep-seated culture of fraud that permeates all financial services and as a result we've been able to keep the music playing longer than all other markets. See that double peak of the black line(Miami)? The second peak is pure fraud (straw buyer gets financing to buy condo at double or triple the selling price of 3 months earlier). We also had unparalleled speculation (people camping for days to put down money on multiple condo units, Russians/Brits/South Americans getting insane financing, condos flipped multiple times per week, Realtors and their families "getting high on their own supply"). If you look at public records most of the 58,000 new condos are owned by LLCs and not end users. Condo prices didn't even really drop until the late summer of 2008! Check out : http://www.miamicondoforum.com for more Miami crash news. I repeat Miami will fall another 50% and shock everyone, including our local Realtor propagandists.

Expat said...

I will refrain from making any comments about squiggly or straight red lines...whoops. Too late.

Another $50k to go before the median house price hits the bottom.

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