According to the S&P/Case-Shiller index of home prices in 20 cities, home values are down 32% from their peak set in May of 2006.
S&P/Case-Shiller just reported that February home prices sank 3.3% to just above the post-crisis lows reached in April 2009. It was the seventh straight month of declines.
The only housing market in the 20 cities followed, only Washington recorded a price increase from last year of 2.7%.
On the downside, Phoenix home prices where prices are off a whopping 56% from their peak. Phoenix home prices fell 8.4% over the past 12 months, more than any other metro area in the S&P/Case-Shiller index.
Why is there a double dip? In my opinion, there was never a ‘real’ rise in home prices. See my 8-19-10 post: Was There A San Diego Real Estate Recovery? & my 11-17-10 post San Diego Home Sales Take Huge Fall , where I said “The evidence presented in this and other recent San Diego real estate reports seem to indicate that we have already entered into a ‘double-dip’ in San Diego home values. You won’t see this announced in the news yet, but in a few months it will be front page news.”
Yes, the home price increases last year was artificially created by the government’s home buyer initiatives. This is the same market action we saw with the government’s auto Cash For Clunkers failed cash give-a-way.
“House prices have started to drop at a faster pace and on some indices are now falling at rates not seen since the financial crisis,†said Paul Dales, senior U.S. economist at Capital Economics.
Here in San Diego, monthly home prices were off 1.3% and the annual change was off 1.8%.
