Home Prices Drop and Housing Markets Cool
Global Insight, a company for economic and financial analysis and forecasting, has released the first-quarter 2007 update of its study, House Prices in America. The updated U.S. housing valuation analysis shows a widely dispersed drop in single-family home prices, resulting in a continued decline in the incidence of overvaluation in the nation's housing market.
The overall number of single-family housing units deemed to be overvalued fell from 17% in the fourth-quarter 2006 to 14% (revised). Meanwhile, in terms of single-family asset value, the percent deemed to be overvalued fell to 25% from 33% (revised) in the prior quarter.
Nationally, single-family home prices increased in the first quarter at an annualized rate of 2.2%. On a year-over-year comparison, however, prices are up only 3.0%, further normalizing the market with the weakest gain in a decade. Nearly 50% or 157 of the 317 metro areas in the study experienced price declines in the first quarter, accounting for 38% of all single-family units and half of all single-family real estate assets in the nation.
The most highly concentrated declines, while widely dispersed, occurred in areas that had experienced the most dramatic run-up in overvaluation, including California, Florida, New York, and New England. The industrial Midwest was hit hard by the cutbacks in automobile manufacturing. The most dramatic declines among the nation's large metro areas were seen in California's Central Valley. Sacramento Calif., where prices fell by 8.2% inthe past year and 10.0% since 2005, experienced the greatest decline among the nation's large metro areas.
Prices were most resilient in the Pacific and Mountain Northwest, most of Texas, and the Carolinas.
Markets identified in the study as overvalued decreased to 54 metroareas in the first quarter, down from 62 metro area markets (revised) in fourth- quarter 2006. The nation's most overvalued markets are now Bend, Ore., and Prescott, Ariz., highlighting the precarious nature of the price resiliency in the interior West. Meanwhile, the most undervalued markets continued to be in Texas, specifically Dallas (24.9%) and Houston (22.1%).
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The overall number of single-family housing units deemed to be overvalued fell from 17% in the fourth-quarter 2006 to 14% (revised). Meanwhile, in terms of single-family asset value, the percent deemed to be overvalued fell to 25% from 33% (revised) in the prior quarter.
Nationally, single-family home prices increased in the first quarter at an annualized rate of 2.2%. On a year-over-year comparison, however, prices are up only 3.0%, further normalizing the market with the weakest gain in a decade. Nearly 50% or 157 of the 317 metro areas in the study experienced price declines in the first quarter, accounting for 38% of all single-family units and half of all single-family real estate assets in the nation.
The most highly concentrated declines, while widely dispersed, occurred in areas that had experienced the most dramatic run-up in overvaluation, including California, Florida, New York, and New England. The industrial Midwest was hit hard by the cutbacks in automobile manufacturing. The most dramatic declines among the nation's large metro areas were seen in California's Central Valley. Sacramento Calif., where prices fell by 8.2% inthe past year and 10.0% since 2005, experienced the greatest decline among the nation's large metro areas.
Prices were most resilient in the Pacific and Mountain Northwest, most of Texas, and the Carolinas.
Markets identified in the study as overvalued decreased to 54 metroareas in the first quarter, down from 62 metro area markets (revised) in fourth- quarter 2006. The nation's most overvalued markets are now Bend, Ore., and Prescott, Ariz., highlighting the precarious nature of the price resiliency in the interior West. Meanwhile, the most undervalued markets continued to be in Texas, specifically Dallas (24.9%) and Houston (22.1%).
Bookmark http://universeeverything.blogspot.com/ and drop back in sometime.
Labels: California, Florida, home prices, homes, House, housing market, New England, Texas
posted by Scott Nance at
6/24/2007 01:33:00 AM
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