Case-Shiller numbers show home prices depreciating at an increasing rate in these Western cities. Does that make any sense?
Well, it’s old news that prices fell in November but it’s nice, I suppose, to know the exact magnitude of the decline.
Phoenix Home Prices
The Case-Shiller numbers show metro Phoenix home prices fell by 3.2% in the single month of November. One remark, “Wow!” The previous big loser was October 2007 with a 2.3% fall.
So using Case-Shiller numbers, Phoenix home prices are down 14.5% from the peak of July 2006 and down 12% January through November 2007.
Outlook for Phoenix Home Prices
Prices will continue to fall in December and January. It will be interesting to see if the typical seasonal strength in prices February through May will be able to stop the fall. With so much downward momentum, it’s hard to see how the high season could stop the fall. It will probably just slow it down.
Phoenix is many real estate markets
What’s great about this month compared to the last time I published this graph is that now I have charts of the median home prices by zip code in Maricopa county, Arizona.
Metro Phoenix is many real estate markets. The Case-Shiller indices hide the fact that there are large differences within the Phoenix market.
My median home price graphs by zip code can help you untangle some of the sub-markets of the Phoenix real estate market.
2 responses so far ↓
1 Brian McMorris // Feb 16, 2008 at 8:46 am
Being a science and tech guy, I am always amazed to see how human behavior follows physical models of inanimate (read: unintelligent) objects so closely. It makes one wonder if we really have any control over our own destiny or if we are no more than atoms in some giant universal being.
A graph plotting velocity versus time would be similar if I stood on top a mountain, pointed my skis down the hill, got into a tuck, and didn’t pull out till I got to the bottom.
The point here is that you are right, John. There is no way a change in season will change the trend of the data. If lucky, the market will begin to decelerate to the downside earlier rather than later. But there is no way to change the downward price momentum instantly.
But based simply on a look at the graph and typical physical behavior, it is hard to see the market price pulling out of its dive before it gets to $160K, which is the target the graph has projected for better than a year, since it began its topping process.
2 John Wake - Real Estate // Feb 16, 2008 at 10:00 am
Wait until you see the new Market at a Glance chart if you want to see downward momentum. I’ll post it later day.
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