Home Prices Fall 12.7%

Declines in the prices of existing single family homes across the United States worsened in February 2008, with 17 of the 20 now reporting record low annual declines — 10 of the 20 regions were in
double-digits:

"There is no sign of a bottom in the numbers. Prices of single family homes continue to drop across the nation. All 20 metro areas were in the red for the February-over-January reading. In addition, 19 of the 20 MSAs are still reporting negative annual returns. The monthly data show that every one of the MSAs has now declined" –David M. Blitzer, Chairman of the Index Committee at Standard & Poor’s.


S&P/Case-Shiller Home Price Indices

Case_shiller_february_2008

Chart courtesy of S&P

S&P/Case-Shiller Index – February 2008 TableSp_caseshiller_index_february_200_2

Table courtesy of TFS Derivatives

UPDATE: April 29 2008 11:58am

Tim Iacono posts this lovely charts:

080429_case_shiller_indices

>

Sources:
Steep Declines in Home Prices Continued
S&P, April 29, 2008
http://www2.standardandpoors.com/spf/pdf/index/CS_HomePrice_Release_042952.pdf

S&P/Case-Shiller Index Release – February 2008
TFS Derivatives, April 29, 2008
http://www.tfsbrokers.com/products.html

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What's been said:

Discussions found on the web:
  1. Steve Barry commented on Apr 29

    No surprise…looking at the history of housing prices, a sane person must conclude we are in for another 40-50% drop nationally. One thing…Barry, I AM BEGGING YOU…you probably have the ability to get through to Shiller. I would like to see this chart updated till today…PLEASE!!!!! It is very important to this country to have this data.

    Shiller’s Housing Price History

  2. stuart commented on Apr 29

    BUY BUY BUY!!!

    That must mean Home builders that is. After-all fundamentals don’t seem to matter anyways. China openly considering re-valuing Yuan upwards by 15% against the buck and the buck rallies. Crooked Wheel.

  3. VennData commented on Apr 29

    It’s very difficult to get the up-to-date data on this series. There’s a great deal of manual checking of government records at the local offices by the ultimate sources etc.

  4. mo commented on Apr 29

    Gotta vent…..

    My sister is buying a co-op in Long Beach NY. Has to borrow against her retirement plan to come up with 20% down.

    She won’t listen to me – so frustrating.

  5. Mista B commented on Apr 29

    Looks like NYC, Tampa, Miami, San Diego, Phoenix, San Fran, and some others still have a LONG way to drop.

    The bottom is right around the corner. Unfortunately, that corner is still years away. And it’s going to be a very long bottom. There was no bounce after 1990, just a long period of flat prices. As to why anyone would be in a rush to buy, as if prices are going to have a V bounce like stocks sometimes do, is beyond me.

  6. Mista B commented on Apr 29

    Looks like NYC, Tampa, Miami, San Diego, Phoenix, San Fran, and some others still have a LONG way to drop.

    The bottom is right around the corner. Unfortunately, that corner is still years away. And it’s going to be a very long bottom. There was no bounce after 1990, just a long period of flat prices. As to why anyone would be in a rush to buy, as if prices are going to have a V bounce like stocks sometimes do, is beyond me.

  7. DMR commented on Apr 29

    mo,

    your sister is smart in buying in a down market. Housing prices probably are probably only half way down to their bottom…i.e. the point when it makes sense for conservative buyers who are buying a roof over their heads to return as opposed to investors who are trying to wait for that elusive bottom.

    Markets tend to deal cruel justice to the bottom/top fishers.

  8. Dave commented on Apr 29

    With the huge commodity boom, especially in agricultural products, the areas of the country outside of the 20 largest metros should be doing much better.

  9. Ross commented on Apr 29

    Dave,
    Yes we are. Hunt Co. TX (proud home of Audie Murphy) typical ag land 200 acres and up.

    2000.. $750/acre
    2004.. $1,200/acre
    2008.. $1,800/acre

    This is just average. The good stuff goes for a lot more.

  10. DonKei commented on Apr 29

    Ross,

    I bet very few of the financiers around here (well at least any under the age of 40) have any idea who Audie Murphy is.

    Having done six years as an Army chopper pilot in the eighties, I learned, but I won’t steal your thunder–explain your reference.

    I just bought 25 rural acres here in Alabama, and considering my investing acumen and usefulness as a contrary indicator–even for myself–it’s probably now time to sell rural land.

  11. SteveC commented on Apr 29

    The trader in me likes to trade against the trend, when prevailing opinion reaches an extreme. Has the prevailing opinion not to buy a house right now reached an extreme? If so, maybe time to take the other side of that trade? (Shockingly, my neighbor just sold his house before a sign was even planted in his yard for 10% over market).

  12. Greg0658 commented on Apr 29

    TBP graphics dept – it needs a finger on a can of Silly String

  13. Ross commented on Apr 29

    DonKei,
    Audie Murphy grew up in Hunt County TX. In Greenville, the county seat, they have a museum dedicated to him.

    You can probably run 20 or so beef critters on your 25 acres. Technology is so cool that you can put a GPS tracking device on them. Takes all the fun out of rustling though.

  14. Space Cowboy commented on Apr 29

    Re:DonKei/Ross (Btw name of Murphy’s autobio was ‘To H___ and Back’)

    Rural land may seen a contraction in price as the commute co$tS for the owners continue to rocket up.

    With all those McMansion’s built on 5 acres(or greater), as the distance from urban work centers increase, you might begin to see a reduction in pricing comps as all those (125-150 dollar, more for the Cummins/Powerstroke/Duramax crowd) suv fill-ups impact the household’s budget

    So, with the (ever) higher energy costs the inner city (yes, even all those condo’s & townhomes) will see a resurgance in demand.

    Either you’ll pay to drive far OR you will pay to live close…Either way, You’ll Pay!

  15. Pool Shark commented on Apr 29

    DMR,

    Catching the bottom in housing markets is far easier than catching the bottom in stock markets. Housing bottoms usually last a year or two; plenty of time to get in. They are also very round and flat; so if you miss it by a few months, you haven’t lost much.

    However, housing bottoms do NOT look like the inclined slope we are currently sliding down.

    Have a look at the chart that Steve Barry links to.

    Bottom?

    2013

  16. yusef commented on Apr 29

    It’s a great time to buy or sell a house.

  17. bluestatedon commented on Apr 29

    IF you’re looking for a house not as a short-term investment but as a good place to live, and IF you find something you can truly afford in relation to your income, and IF you can live with further declines in value after you purchase, and IF you’re buying in a neighborhood that’s not going to be significantly destabilized by foreclosures, and IF you find something right for you and your family, there’s no reason not to buy.

  18. Ross commented on Apr 29

    bluestatedon,
    You are exactly correct. Houses are or should be valued on replacement cost. It is a very simple excercise.

    I’ll probably start building my retirement hovel this Fall. Building materials are being discounted and labour is very friendly. At the trough of this market you will be able to buy excellent housing at below replacement cost but you must accept it ‘as is’ and ‘where is’.

    During the boom, developer’s and builder’s margins were obscenely high and municipalities loaded on impact and other fees because they could. I know of one builder that built 3 6,000 sq. ft. spec houses and planned to ‘earn’ a million dollars and retire. He sold 1 and the bank owns the other 2. Ops!

    Your points are excellent. Too many people were conned into believing a house was an investment instead of a place to live and grow up your kiddies. But that’s what ‘free’ money does to people.

  19. ryan commented on Apr 29

    can someone tell me why philadelphia isn’t included in the index? is it geographical overkill, or are they just not important enough (it’s still in the top ten metro areas, i think)?

  20. illusion of prosperity commented on Apr 29

    Anybody know why these Case/Shiller charts leave out Philadelphia – the 5th largest city (6th largest metro market) in the country, while Las Vegas (No. 28) is represented in the top 10?

    Something fishy here.

  21. mysterious eggs commented on Apr 29

    Perhaps a city like Houston should be included before Philadelphia using the same logic. In defense of not including Houston, while it still had a mini bubble, there was never the sort of explosion like other markets. Just not as desirable a location. The same can’t be said of Philadelphia. I’d venture to guess the cities included had the most growth during the bubble.

  22. Lew Dunbar commented on Apr 30

    You guys sound like a bunch of bitter renters.

    /sarcasm off

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