House Prices: Are the Declines Finally Over?

New College Housing Symposium

House Prices: Are the Declines Finally Over?

David W. Berson, Ph.D. April, 18, 2012

Housing Demand Factors

Change in Total Nonfarm Employment (Thousands) 800

800

400

400

0

0

-400

-400

-800

-800

-1200

-1200 01 02 03 04 05 06 07 Source: Bureau of Labor Statistics /Haver Analytics

08

09

10

11

Change in Number of Households (Thousands) 3000

3000

2500

2500

2000

2000

1500

1500

1000

1000

500

500

0

0 85 90 95 Source: Census Bureau /Haver Analytics

00

05

10

Housing Affordability Index (FRM + ARM) 240

240

200

200

160

160

120

120

80

80

40

40 75 80 85 90 95 00 Source: National Association of Realtors /Haver Analytics

05

10

Housing Supply Factors

New 1-Family Houses For Sale (Thousands, Left Axis)

Total Existing Homes For Sale (Units, Right Axis) 600

4400000

525

4000000

450

3600000

375

3200000

300

2800000

225

2400000

150

2000000 02 03 04 05 06 07 08 09 10 Sources: Census Bureau, National Association of Realtors /Haver Analytics

11

Total Vacant Housing Units For Sale (Thousands, Left Axis)

Vacant Housing Units Held off Market For Other Reasons (Thousands, Right Axis) 2400

4000

2200 3600 2000

3200

1800

1600 2800 1400

1200

2400 02 03 04 05 06 Sources: Census Bureau /Haver Analytics

07

08

09

10

11

Mortgage Foreclosure Inventory (%, Red) Mortgage Payments Past Due 90+ Days (%, Blue) Mortgage Payments Past Due 60-89 Days (%, Green) Mortgage Payments Past Due 30-59 Days (%, Black) 6

6

5

5

4

4

3

3

2

2

1

1

0

0 02 03 04 Sources: MBA /Haver

05

06

07

08

09

10

11

House Price Appreciation

Annualized House Price Appreciation, All Homes (% Change - Annual Rate, Red)

Year-Ago House Price Appreciation, All Homes (% Change - Year to Year, Blue) 40

40

20

20

0

0

-20

-20

-40

-40 02 03 04 05 06 Sources: CoreLogic /Haver Analytics

07

08

09

10

11

Annualized House Price Growth - Distressed Excluded (% Change - Annual Rate, Red)

Year-Ago House Price Growth - Distressed Excluded (% Change - Year to Year, Blue) 30

30

20

20

10

10

0

0

-10

-10

-20

-20

-30

-30 02 03 04 05 06 Sources: CoreLogic /Haver Analytics

07

08

09

10

11

Annualized House Price Appreciation, Arizona (% Change - Annual Rate, Red)

Year-Ago House Price Appreciation, Arizona (% Change - Year to Year, Blue) 60

60

40

40

20

20

0

0

-20

-20

-40

-40 01 02 03 04 05 06 07 08 Sources: Federal Housing Finance Agency /Haver Analytics

09

10

11

Annualized House Price Appreciation, California (% Change - Annual Rate, Red)

Year-Ago House Price Appreciation, California (% Change - Year to Year, Blue) 60

60

40

40

20

20

0

0

-20

-20

-40

-40 01 02 03 04 05 06 07 08 Sources: Federal Housing Finance Agency /Haver Analytics

09

10

11

Annualized House Price Appreciation, Nevada (% Change - Annual Rate, Red)

Year-Ago House Price Appreciation, Nevada (% Change - Year to Year, Blue) 80

80

60

60

40

40

20

20

0

0

-20

-20

-40

-40 01 02 03 04 05 06 07 08 Sources: Federal Housing Finance Agency /Haver Analytics

09

10

11

Annualized House Price Appreciation, Florida (% Change - Annual Rate, Red)

Year-Ago House Price Appreciation, Florida (% Change - Year to Year, Blue) 40

40

20

20

0

0

-20

-20

-40

-40 01 02 03 04 05 06 07 08 Sources: Federal Housing Finance Agency /Haver Analytics

09

10

11

Annualized House Price Appreciation, North Dakota (% Change - Annual Rate, Red)

Year-Ago House Price Appreciation, North Dakota (% Change - Year to Year, Blue) 12.5

12.5

10.0

10.0

7.5

7.5

5.0

5.0

2.5

2.5

0.0

0.0

-2.5

-2.5 01 02 03 04 05 06 07 08 Sources: Federal Housing Finance Agency /Haver Analytics

09

10

11

Annualized House Price Appreciation: Bradenton-Sarasota-Venice, FL (% Change - Annual Rate, Red)

Year-Ago House Price Appreciation: Bradenton-Sarasota-Venice, FL (% Change - Year to Year, Blue) 40

40

20

20

0

0

-20

-20

-40

-40 01 02 03 04 05 06 07 08 Sources: Federal Housing Finance Agency /Haver Analytics

09

10

11