Comments on: Housing and the Crisis, Part II

By: Mortgage Refinance at 2% with Obama’s Housing Affordability Plan | Foreclosure Bailout Lenders

Wed, 05 Aug 2009 22:15:56 +0000

[...] Creative Class » Blog Archive » Housing and the Crisis, Part II … [...]

By: RS

RS — Tue, 28 Jul 2009 19:19:33 +0000

I was just taking a second look at the housing series figures and it occurred to me that a finding that the initial 2006 housing values are negatively related with the change from 2006 – 2009 suggest that housing values are converging over time.

Those places with high initial housing values had, on average, negative growth whereas those places with low initial levels had, again on average, positive growth (or rather less negative growth). This is an indication of covergence.

By: Michael Wells

Michael Wells — Tue, 28 Jul 2009 01:20:58 +0000

You get a different picture if you push the baseline back a little to 2001. The numbers below are all estimated from Zillow graphs.

In hard hit places you get a hill-shaped curve. The average house price in Modesto in 2001 was $150,000, in 2006 it was $350,000, and today it’s $150,000 again. Rapid climb and even more abrupt dropoff, and with foreclosures and forced sales, this may not be the bottom.

In Portland during the same time, the average went from $150,000 to $300,000 to around $200,000. The USA as a whole went from $120,000 to $200,000 to $180,000. So while the ride was scary, especially if you bought in the middle, there was actually a reasonable increase over 8 years. Of course, things could still fall further.

By: James Russell

James Russell — Mon, 27 Jul 2009 17:26:56 +0000

The data seem to underline the key meltdown causes. In Calif., Fla., Ariz., and Nev., there was enormous speculative activity, some of it fraudulent, lots of it just get-rich-quick dips__ts. Fla. and Ariz. are serial offenders, flim-flammer paradise. Details will probably show in the underperforming rust-belt cities a combo of industrial decline and aggressive predatory subprime lending.

Isn’t it nice my home city of NYC has declined less than others? No, it makes us even less competitive than ever. Same for Seattle and a few others. Our prices will A) continue to drift downward, or B) take a hit after the recovery, when people give up and move someplace they can get a good job and afford.

By: MPS

MPS — Thu, 23 Jul 2009 15:35:21 +0000

Cumberland is nowhere near a suburb of Washington. It’s over 2 hours away and just as close to Pittsburgh as DC. It’s housing resilience is probably a function of being a small, stable Appalachian city similar to Charleston or Morgantown, West Virginia. Hagerstown, MD, about an hour east of Cumberland, is probably a more plausible “exurb” of DC/Baltimore.