Prices Rise Again Nationally, Says Case-Shiller October Release
The October Case-Shiller report released the last week of October (August results) shows prices rising from July by .3% in both the 10 and 20 market national composite indices. The indices are still down year over year 3.5% and 3.8% respectively.
The Tampa and Miami markets were down slightly for the month at -.1% and -.3% respectively and leaving them at -5.8% and -4.6% compared to August 2010.
The chart below shows index information by market. Notice that nationally (using the broader 20 market composite index) the price index peaked in July 2006 at just above 206. This implies that prices slightly more than doubled in the six and a half years between January 2000 (when the index was 100) and July 2006. This same index has since given up 30.8% and now sits at 142.8 (or 42.8% above the January 2000 level).
If you look at the market information in the chart above you will see that a couple of markets have really been beaten back since the peak with declines over 55%, namely Phoenix and Las Vegas. Both of these would seem to be somewhat of a surprise as prices weren’t particularly over extended (relative to the national average) yet the current price level came crashing back to the year 2000 or earlier.
Another interesting group is the California markets (LA, San Diego, and San Francisco). All three of these hit peaks higher than the national average (LA and San Diego much higher), yet their current indices are all above the national average (with LA and San Diego being considerably higher). California has a state debt of over 612 billion (StateBudgetSolutions.org ). If California were a country they would be number 12 on the countries with the highest debt levels, somewhere between Mexico and Spain (CIA World Fact Book). They account for some 15% of the $4 trillion in total US state debt. They also have among the highest income tax rates in the country. Their 9.4% personal income tax rate is the highest as is their 8.25% sales tax rate. Their corporate rate of 8.84% is the 6th highest. Every time you pick up the paper some big company is threatening to leave the state. Yet they seemingly have an above average residential real estate market. Go figure.
Finally, look at the turtles in this group – Dallas and Denver. Their home prices never really shot up at all. At their peaks, the indexes for Dallas and Denver were 126 and 140, respectively. Or home prices went up only 26% and 40% over a 6-7 year period. Now they are down only 7.3% and 9.8% from their highs. On average, no matter when you bought or refinanced there, as long as you did so with 10% equity you are still above water. That seems almost foreign.