16
HOUSING PEAK LEVELS;
THEN VS. NOW
CoreLogic Principal Economist Molly
Boesel recently took a look at the overall boom-
and-bust cycle for the housing market in 2017.
Looking at the length of the decline and how
far prices fell, CoreLogic is revealing parallels
between the peak levels of the past and the
present.
According to Boesel, while 11 years have
gone by since the start of the housing crisis in
2006, U.S. home prices are nearly back to the
peak level they were at in April of 2006. "After
hitting peak in 2006, the national price level fell
for five years, finally reaching bottom in March
2011 after falling 33 percent nationally," Boesel
said.
CoreLogic's data indicates that the U.S.
home price index is almost back to those
peak levels, but regionally, some locations are
still far from it. When considering the U.S.
housing crisis home-price declines compared
to some other historical declines, this is what
CoreLogic's data discovered.
According to Boesel, in the mid-1980s, Texas
experienced an oil bust that caused home prices
to fall by 16 percent over three and a half years.
"At that time, Texas home prices took nearly
nine years to recover," Boesel said.
Another example is California's market in
the early 1990s. Boesel noted that "defense and
manufacturing job losses" led to home-price
declines. And after falling by 15 percent over five
years, "home prices in California fully recovered
after eight years."
CoreLogic's data discovered that after
peaking in March 2006, prices in Nevada fell 60
percent. After more than 11 years, home prices
in Nevada through July 2017 were still 27 percent
below the peak level.
"Not all areas saw such deep declines in
home prices, and some areas are far above where
they were before the start of the housing crisis,"
said Boesel. "For example, Colorado hit a peak
in the home price index in August 2007, fell by
14 percent over four years, but since then has
surpassed the 2007 peak by 42 percent."
Overall, the insights noted that 34 states and
the District of Columbia have surpassed their
precrisis home price levels today.
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