Comments on: Case-Shiller: 2008 Home Prices Hit Record Declines

By: binkys

binkys — Wed, 25 Feb 2009 15:24:18 +0000

Here in Manhattan (NYC), prices have not reverted to 2003. However, I expect them to. There was overbuilding. We did not have an issue with sub-prime and liar loans because the majority of our housing stock is co-operative apartments. However, the hit that Wall Street is taking will soon reduce housing prices here also as the finance industry shrinks.

By: rktbrkr

rktbrkr — Wed, 25 Feb 2009 14:51:39 +0000

Interesting article about cash sales in the sun bubble states. An indication how heathy our banking system is when you need 50-100% cash to buy a home in these areas (but a couple years ago you didn’t need a farthing!)

http://online.wsj.com/article/SB123552303469165085.html

By: pmorrisonfl

pmorrisonfl — Tue, 24 Feb 2009 23:31:08 +0000

> to get technical, not so much higher-end, as ‘older, been there longer, more settled

To get annoyingly technical, you’re exactly right about Hollywood, and for the right reasons… but Jackson’s is the other kind of higher end. It’s in the same building as H. Wayne Huizinga’s offices. Later I worked in a building across the river, where one of the guys had binoculars. He’d watch who was getting on and off HWH’s helicopter, and call out the celebrities. Marino, Elway, etc.

By: Mike in Nola

Mike in Nola — Tue, 24 Feb 2009 18:59:05 +0000

My question is how the cities in the survey were chosen? Was it the bubble areas or what?

I finally looked at the source S&P document out of curiosity to see how Houston was doing and found that it’s not included. It’s 4th largest city in the country? Can hardly be called a good sample.

By: Mark E Hoffer

Mark E Hoffer — Tue, 24 Feb 2009 18:17:55 +0000

Paul,

to get technical, not so much higher-end, as ‘older, been there longer, more settled’–read: way more Equity build-up/ lighter Notes to tote..

had in Uncle in Hollywood who blew in ’005 b/c ‘it was getting too crowded’

bhe,

you make a good point about there being two markets. the Retail/MLS advertised one, and the, more informal, Auction/FSBO/REO one…as you mention, a huge delta ‘tween the two..

cfischer,

when I first heard of the ‘reverse-commuting’ trend, about a decade ago, I was thinking to myself: “Now, that’s intelligent.” little surprise to see one at TBP..

By: Paul S

Paul S — Tue, 24 Feb 2009 17:51:42 +0000

Thanks for the perspective pmorrisonfl. I had an inkling that the locale described was “higher end”.
These are the folks who benefitted the most from the past 7 years.

By: pmorrisonfl

pmorrisonfl — Tue, 24 Feb 2009 17:46:30 +0000

> Jackson’s Steakhouse
I worked in the same building as Jackson’s a decade ago, still live in Broward. I’d say the prices and clientele of Jackson’s make it a less than ideal venue for sampling the state of the local economy. There certainly are a lot of people eating out in Broward… and I drive by several closed Starbucks as well.
Hollywood is pretty settled, you have to go West (or North, or South) to see the rampant ‘for sale’/foreclosure signs (altohugh they’re there in Hollywood if you look). South Florida is its own little planet, so it’s hard to draw conclusions from any sample you take.

By: ottnott

ottnott — Tue, 24 Feb 2009 17:40:32 +0000

Barry wrote: “My working presumption is that these are skewed by the foreclosure driven price decreases in 4 areas: California, S. Florida, Las Vegas, and Arizona.”

I believe that you are correct.

While the Case-Shiller methodology improves on median-price numbers by looking at price changes for resales of individual properties, it doesn’t correct for changes in the types of homes that are being resold.

In many areas, it is the new housing developments and the low-price neighborhoods that are selling for huge discounts from peak and are dominating sales today. If those categories accounted for 60% of sales today, but only 40% of sales a year ago, they would have an oversized impact on the Y-O-Y change in the C-S index.

http://piggington.com/ , which provides excellent analysis of San Diego housing prices, has a graphic indicating that the increase in sales volume between Jan 08 and Jan 09 was 3% in the 20 most expensive zip codes and 87% in the 20 least expensive.

My anecdotal report is that my part of San Diego (least expensive portion of an expensive area) is probably down 20% from the peak, but half that 20% is in the last 4 months or so.

By: bonghiteric

bonghiteric — Tue, 24 Feb 2009 17:10:09 +0000

Anecdotal from the western Philladelphia suburbs. There seems to be two markets here. The posted prices seen on Realtor.com, etc. and a growing short sale/foreclosure market. There is an increasing volume of homes on multi-acre tracts listed in the mid-upper six figures. Bids are being accepted that are a couple hunred thousand lower. This from the experience of a good friend who is actively looking.

In my area I’ve seen a lot of for sale signs spring up. I’ve noticed it because it’s winter, and a colder one at that. Two acres of ground on the outer main line going for under $230K is a considerable reduction from where prices were 18 months ago.

By: cfischer

cfischer — Tue, 24 Feb 2009 17:04:45 +0000

Ben,

In the same area as you.. Live in Philly(Manayunk) and work in DE. The prices are not at the 2003 levels but they certainly aren’t at the 2006 levels either. But we also never really had the run up either (for whatever reason) that Philly, NYC, DC and Boston all did.