The latest S&P/Case-Shiller Home Price numbers came out yesterday. The headline was bad: The 10-city composite was down 8.4% in the 12 months ending in November, the worst performance in the history of the index, which goes back to January 1987.
But real estate is, as they say, local. So Feilding Cage and I have put together another graphic view of the metropolitan-area-level numbers. This time I thought it might be interesting to see the short-term trajectory. I picked January 2005 as a starting point–mainly because 2005 and the first half of 2006 were probably the period of greatest craziness in the mortgage market, but also because I tried starting with January 2004 and the chart just didn’t look as good.
My reading of the chart is that the metro areas that show the clearest signs of having been caught up in a lending-fueled bubble that is now deflating seem to be Phoenix, Miami, Tampa, and to a lesser extent Los Angeles. My suspicion is that home prices in all those areas may be headed back to something close to (or below) January 2005 levels. In Phoenix, where prices have already fallen 14% from their June 2006 peak, that would mean another 20% drop.
One other thing: Portland and Seattle look like they’ve finally peaked.