“It’s a little known fact,” as Cliff Clavin would tell us, “that the first city to have its housing bubble burst was Boston.”  How appropriate, eh?

Since no one lives in either Composite10 or Composite20, below is a portion of a spreadsheet I maintain chronicling the popping of the bubble (this is on a NSA basis) in each of the 20 metro areas.  Boston kicked things off in September 2005 (peak cells shaded with green), and city after city crested and began its decline over the next two years, ending with Charlotte in August 2007.  (Green text signifies an uptick from the prior month, red text a downtick.)

The last row — beneath the yellow line — is the most recent CS print.  It’s interesting, still, to see the most recent prints versus the peak values.

(Click through for ginormous — necessary to really see the numbers)

(Source: S&P Case-Shiller.  All cities indexed to 100 at January 2000)

Category: Cycles, Data Analysis, Economy, Real Estate

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

4 Responses to “Case-Shiller Bubbliciousness”

  1. krice2001 says:

    Have lived in the Boston area for a number of years now and that early 2005 home price peak appears about right. When buying a house in the western suburbs in 2003, the homes were already not moving and we had lots of time to look and decide. Just 18 months years earlier than that, my admin at that time, bought a house in a less expensive suburb and had to bid over asking price just to get a house. I saw things changing by then.

  2. tenaciousd says:

    That Case-Shiller chart just doesn’t want to give up the ghost! It’s nowhere near a full reversion.

  3. flocktard says:

    The only problem I have with Case Schiller is that “all real estate is local,” and using it as a proxy for the entire housing market can be somewhat misleading.

    Let’s face it, places like Vegas and huge swaths of Florida are going to be radioactive for years to come, while other markets will attain some equilibrium, and some faster than others. If you take out what came to be known as the “sand states”- Arizona, Florida, Nevada and Florida- the picture will evolve differently over time.

    As far as getting pricing back into the 2005-2007 post NetCap rule elimination bubble, forget it. Your grandchildren will be lucky to see it.

    Invictus: I actually created a chart that showed the CS-20 broken down with the six mega-bubble areas vs. the “other” fourteen. I’ll have to dig it out and post it.

  4. Expat says:

    Median household income multiplied by 2.75. Call me when we are there and we can start talking about a market near the bottom. 49k x 2.75 = $135k. Median house price is around $170k so another 20% to go at least.

    It has nothing to do with interest rates, inflation, or Ben Bernanke. It has to do with affordability, unemployment, inventories, and lending. Sure, today anyone who can get a loan can afford a massive house thanks to ZIRP. But when ZIRP is over (talk to Italy and Spain, baby), then house prices will make the final, big leg down.