Latest S&P Numbers: Surprise! They Ain't Good
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,…
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.
“Case-Shiller is by far the best source for understanding what is really going on with the housing market, because it looks at actual resales of the same property.”
But they only look at houses that were bought and sold within a two-year period! We call those flips. Flips are not making profits anymore, any ‘tard knows that. We don’t need Case-Shiller to tell us that, jeepers.
Show me a profit on a Brooklyn brownstone somebody owns for 5 to 10 years. That’s what tells me what I need to know about my investment. Not what somebody can make owning the house for 2 years. Please. Duh.
11:36 — if gas doubles, a Orange NJ commuter might pay an extra 2k / year to live there. That isn’t going to convince anyone to spend an extra $1m to buy in Park Slope. Especially since the difference in car insurance rates and parking is far more than that anyway.
I think Park Slope and FG have gone up a good deal more than 200% since 1990. More like 3x and 5x respectively.
“The question is, is the era of declining interest rates over? Right now, my bet would be yes.”
Not only is that era over, a new era is born: Rising Rates. Peep the minutes of today’s Fed meeting. Inflation is on their minds.
If you read the article at 11:19 you will see why this will not pertain to Manhattan and prime Brooklyn.
In case you missed it gas has doubled in 3 years (will probably double again in the next 5-7) and the suburbs are over.
I don’t know ANYONE who actually wants to move to the suburbs now. They move there because it’s cheaper. Know what that means…? It means the suburbs are turning into the ghettos and the cities are being revived and becoming the jewels again as they were when this country was first built.
It makes sense economically. It makes sense socially and it makes sense environmentally.
The only reason it wouldn’t make sense is for those who are so unable to evolve with the changing face of our planet that they simply MUST have their McMansion in the burbs.
The median price for a house can grow faster than meidan income when you are in a period of falling interest rates as happened over the past 10 years. i.e. If you’re paying 6% on a 120,000 loan it costs less than paying 8% on a 100,000 loan. The question is, is the era of declining interest rates over? Right now, my bet would be yes.
“This is BS, price drops in the New York “Metro” ie places like Newark, does not mean anything as to Manhattan and Brookyn Prime where price gains remain strong. Sorry folks.”
But if you go to the S&P website, take their numbers for NY Metro, throw them in a spreadsheet, take % differences on the way up (since the 1990’s), you’ll see that it correlates to the Manhattan/Brooklyn market to a “T”. The index went up 200% from the last bottom just like Brooklyn and Manhattan. Why would it be irrelevant on the way down?
“At least the What cuts and pastes from reputable sources and actually has some backing from economists for what he says. ”
Put 100 economist in a room and you will get 100 different opinions.
Anyone can cut and paste economist backed opinions. Wasn’t David Lereah an economist? What was the title of his last 3 books?
I hope you understand my point.
Read this:
http://www.nytimes.com/2008/06/25/business/25exurbs.html?hp