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The Journal reports that the most recent S&P/Case-Shiller indexes, which covered home-price trends in 20 major metropolitan areas through April, show home prices dropping 15.3 percent in the past year—a record decline. The continued devaluation of residential real estate across the country set home prices back to where they were a whole three years ago, even though eight of metropolitan areas included in the index showed a bit of improvement over March of this year. There was no region studied, however, that did not post a year-over-year decline in prices. Vegas and Miami saw the biggest price drops between April ’07 and April ’08, while Charlotte and Dallas fared the best. The New York region was somewhere in the middle, with a year-over-year decline of 8.4 percent and a 1.3 percent dip between March ’08 and April ’08. “There might be some regional pockets of improvement,” said David M. Blitzer, chairman of Standard & Poor’s index committee, though “on an annual basis the overall numbers continue to decline.”
Home-Price Gains Are Erased, Now Stand at 2004-2005 Levels [WSJ]
Graphic from the Wall Street Journal.


What's Your Take? Leave a Comment

  1. 11:19am from June 25 – we’ve **seen** that article – you keep posting it over and over again about how the suburbs are dying, everyone wants to live in urban areas because of gas etc. But simply posting that article over and over again is not going to prop up the sagging NY real estate market. True, these stats may not zero in on places like prime Bklyn but even here there are numerous price cuts starting to happen. I’m in the market for a townhouse (having sold our apt a few months ago, pre-Bear Sterns) and brokers are clamoring to have us make offers, even low ones, on properties they are selling that are either not moving, or taking cuts. This trend will probably continue moving downwards for the next year or so. We’re taking our time, but will jump in at the right place at the right price – things are still overpriced but at least sellers seem to be getting more negotiable, perhaps because they realize it’s not going to get any better any time soon, and could very well get worse so may as well take the significant profits now (which they are sure to make if they bought anytime before last few years)…

  2. Where are you going, guest @ 10:44? We are also considering a move (well, we are actually agonizing over it) to the ‘burbs and have been checking out towns along the Hudson and Harlem train lines. So far, Bronxville seems to be a winner.

    Good luck with your move. Life is compromise, right? I think it was Darwin who said that it’s not the strongest that survive, but those most adaptable to change.

  3. “”I don’t understand how buying and selling paper — a theoretical right to future delivery that will be settled in cash without any oil actually changing hands — affects the price of the real thing. Usually derivatives derive their price from the underlying asset, not the other way around.”

    “Commodities are different from other kinds of paper in this regard, because if the future price rises above the cost of interim storage, an arbitrageur can make a risk-free profit by buying the underlying asset, selling the future, and storing until delivery date. That means that the future prices are more tightly coupled to the spot price than is the case for other asset classes. For more information, read the wikipedia page on contango.

    “Incidentally, a corrollary is that if oil inventories stay low, it’s more likely that fundamentals rather than speculation is driving a rising price.”

    This all makes sense, but then if speculation is driving price there should be some stored food or oil inventories, just as there were in several of the famous famines, or like the electricity shutdowns in California.

    Krugman says there aren’t any signs of this inventory buildup. Is it possible to hide it??