PrintMost metro areas will see prices fall below the lowest levels of the last 20 years, according to the latest forecast from University Financial Associates of Ann Arbor.
“It is often stated that prices decline faster than they rise because fear is a stronger emotion than greed. This certainly proved to be the case in Detroit where 10 years of real price gains were erased in just 4 years,” said UFA in its most recent UFATM House Price Forecast.
“Detroit metro was the canary in the coal mine this cycle, with falling house prices arriving earlier than in other metros,” said Dennis Capozza, who is the Dykema Professor of Business Administration in the Ross School of Business at the University of Michigan, and a founding principal of UFA. “Other metros that have already or will soon converge to pre-bubble real prices include Las Vegas, Phoenix, the inland California metros and many south Florida metros.”
UFA’s prediction would take the national median price of a home in most markets below $101,000, the national median in 1990, according to the Census Bureau.
UFA’s forecast was released on the heels of several other indicators showing prices resuming a downward trend. Last month, the national median price for existing homes was $165,100, down 1.8 percent from a year ago, according to the National Association of Realtors. Since prices began to fall in 2007, the median price of an existing home has fallen 21 percent, from $219,000.
The Federal Housing Finance Agency’s seasonally adjusted monthly index for December was down 1.6 percent from November, reversing price increases over the prior months. The monthly change from October to November was revised downward to +0.4 percent, from an initial estimate of +0.7 percent.
While FHFA’s national, purchase-only house price index fell 1.2 percent from the fourth quarter of 2008 to the fourth quarter of 2009, prices of other goods and services rose 1.9 percent. Accordingly, the inflation-adjusted price of homes fell approximately 3.1 percent over the latest year.
FHFA’s all-transactions house price index, which includes data from mortgages used for both home purchases and refinancings, fell over the latest quarter. The index declined 0.7 percent in the latest quarter and 4.7 percent over the four-quarter period.
March 17th, 2011 at 5:45 pm
UFA’s prediction would take the national median price of a home in most markets below $101,000, the national median in 1990, according to the Census Bureau
March 17th, 2011 at 5:53 pm
Well it looks like were going to go in a dubble resection with the housing market this is really going to suck