Government Ranks Sacramento Real Estate Market as 9th Weakest
The Sacramento real estate market is the ninth weakest real estate market in the nation, according to a report [pdf] released today by the Office of Federal Housing Enterprise Oversight (OFHEO). Click the image to enlarge.
The government's House Price Index (HPI) for Sacramento declined 6.1% in the second quarter of 2007. The 6.1% drop was the fifth steepest year-over-year decline since 1977, the year OFHEO started tracking home appreciation for the Sacramento real estate market.
1983 Q3: -7.42%
1994 Q4: -6.71%
1995 Q1: -6.47%
1994 Q3: -6.25%
2007 Q2: -6.07%
Since peaking in 2005, Sacramento's HPI has dropped 7.0%. Prices have continued to fall at a more rapid pace than the housing bust of the 1990s. At this stage of the '90s bust, Sacramento's HPI had declined 3.9%.
10 comments:
What I find intersting about the HPI drops and the Case-Shiller Index drops is that they are occuring quite large for it being so soon after the peak. Compare this with the last bubble in the 90s, where these sort of drops in the indexes weren't seen for several years after the price peak. (see the data in the post above).
I suspect the Internet is a direct cause of this happening. Something about its ability to spread information quickly. Having worked in the industry during the early '90s (actually running the foreclosure department of a title company), I can tell you that the general public had no idea of what was going on. Things are different today.
with ya sac prof
So I guess it's the internet's fault for the housing collapse and credit crunch. Damn those statistics! So now little Johnny will be telling his teacher "Mrs. Smith, the internet ate my homework."
I think they were only referring to how fast it dropped, not how far it has to fall.
Then again the fall could be so huge that we really are just seeing the first dip- now that's scary.
I know Sippin's gig all too well to fall for that. He's looking for any excuse as to why the market is “artificially” depressing his beloved RE market. So the internet is a great place to land blame. Maybe it's Al Gore's fault since he invented the internet.
What a thrill to see SLO in the bottom 20. Precious wine country depreciating? This graph must be wrong; I was told by countless agents that this area would be "immune from any bust...because it's so beautiful!" Takes me back to Ben Stein's article about his Malibu property in the early 90s. Does no one read?
"Then again the fall could be so huge that we really are just seeing the first dip- now that's scary."
Talk to the Japanese. They got hammered in real estate and the net result was an economic recession that lasted 15-16 years... all because the government subsidized (ala Allan Greenspan?) their growth the previous decade before. What saved them from total collapse was their trade surplusses and strong personal savings... two important features we don't seem to want to address.
Bush to outline subprime initiative
http://news.yahoo.com/s/nm/20070831/bs_nm/bush_subprime_dc_7
Uncle Sam to the rescue! This ought to be good...the question is...who gets hurt?
"Compare this with the last bubble in the 90s, where these sort of drops in the indexes weren't seen for several years after the price peak."
Maybe it's the difference between a pop and a slow leak...
The two differences between the 1990s housing bubble and the present one:
1.Housing prices rose much more steeply, as the Case-Shiller graph indicates.
2.The collapse of the 1990s was the result of the recession and foreclosures dribbled along for several years, as job losses and other family crises forced defaults. This collapse is the result of mortgage resets. People who are upside down can't just wait it out, as they were dependent on refinancing to get out of the ARM.
What this means, of course, is that the fall is likely to be steeper than in the 1990s. What we don't know, however, is whether the housing recession will lead to a more general recession, which might force people who don't have ARMs into foreclosure later on.
Post a Comment