Decline Continues: Bottom in Sight?
The Home Price Index for December was released by the Integrated Asset Services, LLC (IAS). The index reflects a 13.8% decline in house prices for 2008 and an overall decline of 19.1% since the market’s peak at the tail-end of 2006.
The report also notes 10 counties hit the hardest during the national decline, showing that many were in states that saw the largest gains during the housing bubble, including California and Florida.
At the U.S. Census region level, both the West and the South experienced double-digit declines for the full year 2008. The West, which dropped 18.4% in 2008, fell over 24% from its peak in 2006, while the South, down 12% during 2008, was off nearly 18% from its high. The Northeast saw declines of 9.4% for 2008 and 11.7% from its peak. The Midwest, despite significant declines, was the least impacted region in the U.S., and posted declines of 7.4% in 2008 and 10.4% from its peak.
At the MSA level, San Francisco, San Diego, and Miami were the hardest hit areas in 2008, with declined rates of 23.9%, 22.7%, and 20.8% respectively. Within San Francisco’s MSA, Contra Costa County declined at an astonishing rate of 35.5% during 2008 and 42.2% since its 2006 peak. Also within the San Francisco MSA, Marin County and San Francisco County posted less astonishing declines of 11.3% and 13.9% from the 2006 high, while declines accelerated to 15.4% and 16.1% across 2008.
But an end to the decline may be in sight, as noted in a in a story published on Bloomberg.com. Despite the continued price fall, Moody’s Economy.com suggests the light at the end of the tunnel is approaching. Prices will likely continue a decline through much of 2009, but are expected reach bottom by year’s end. For more on this, check out the story at Bloomberg.com.
—Robert Burke
*The IAS360 House Price Index is a comprehensive housing index tracking monthly change in the median sales price of detached single-family residences across the U.S. The index, based on all arms-length transactions, tracks data of 15,000 “neighborhoods”, which is rolled-up to report on the changes in 360 counties, nine census divisions, four regions, and the nation overall.
