Case-Shiller Home Price Index Updated

The Case-Shiller update has just come out for their 20-city index on home pricing. This graph line just continues to fall off the page. I showed this at the real estate conference and commented that its not only falling, it seems to be speeding up! Well, that still seems to be the case. Consider these numbers for Los Angeles:

The low price range is less than $408,960 (current dollars). Prices in this range have fallen 37.9% from the peak in real terms. The mid-range is $408,960 to $617,001. Prices have fallen 32.5% in real terms. The high price range is above $617,001. Prices have fallen 24.1% in real terms.

Here’s a PDF of the press release from S&P.

A little concerning, Los Angeles is a key feeder market for Vallarta…

Vallarta Real Estate Trends 2008

Here’s a sneak preview of my real estate trends article that will be published in Vallarta Lifetyles next month. Appreciate any comments, as there’s still time to make changes to it before we go to print.

 

I’ve been writing this article for the past five years, five exceptional years where the market experience rapid growth, appreciation and demand. With last year’s report I touched on the trend that a downturn seemed to be approaching. Today, while updating and writing this report, there is no doubt that the market has slowed and the USA is most likely in recession. Is there good news out there? I believe so. I believe that this is just a minor market downturn for Vallarta, a switch from being a seller’s to a buyer’s market, but this will be only temporary. Vallarta is fundamentally a strong market with a lot to offer second-home buyers. Its been somewhat of a roller coaster up to this time, a slowdown can be of welcome for some, such as for allowing infrastructure to catch up with private growth. Although most developers would beg to differ!

Lack of Activity…

Sorry for the lack of any postings recently, for those of you who check back regularly. I’ve been on vacation and just recently got back into town. Most recently I’ve been busy working on my annual Real Estate Trends article for the Summer/Fall issue of Vallarta Lifestyles, which has taken up quite a bit of time.

This has been an interesting article to write. For the past five years its been relatively easy and quite upbeat. The market continued to grow, appreciation was obvious and everyone, especially developers, were happy. Last year I touched on the fact that a downturn seemed to be on the horizon. This year, well, its obvious to all that it is certainly here. 

So how do you write about a down-turning real estate market in an publication that’s surrounded by real estate advertisements?

Carefully!

I think you have to tell it like it is. It is a slower market, it is a buyer’s market and to not say so would erase any form of credibility the publication, or this blog, may have. But I spend a lot of my time studying both this market and the USA market (it has such a large influence on our local market), and I continue to conclude that the fundamentals of this market are good. That this is just a natural normalization of the market, as markets do not always just go up. What goes up, must also come down. The unknown is for how long. I’ll post parts of the article shortly. Any comments would be much appreciated.