Search Like An Agent!
Register for a FREE Listingbook Account

From the category archives:

Market Conditions

100 Years of Housing Prices

by Karen Goodman on August 15, 2010

in Market Conditions

I just came across this chart on The Big Picture blog which was created by one of their loyal readers, Steve Barry, to show the changes in home prices (adjusted for inflation) since the Case Shiller index started tracking home prices in 1890.

case-shiller-updated-100-yr-chart

Click on the chart to see a larger version (or here if you need to see it even bigger).

A few things strike me looking at this chart:

  • None of us should be surprised that prices are down from what they were in the fist half of the 2000′s decade.
  • If the projections are correct, then it won’t just be the people who bought or refinanced in 2004-2006 who will be in trouble. Anyone who purchased in the last 10 years may see their home value drop below their purchase price.
  • I still think homes are a good investment since we all have to live someplace, and the alternative to buying a home is to pay down someone else’s mortgage and live in a rental. But, we shouldn’t be looking at homes as a high growth investment. Think of it more like the slow growth bond which is hopefully fairly safe, but will grow very slowly rather than the hot stock which may take off and earn you a bundle, but could crash just as quickly.
  • The last time there was a big boom that didn’t crash all the way back to the pre-boom prices was World War II. But the end of WWII came with a huge number of returning soldiers with GI Bill money to go buy a house for their baby boom families. I can’t imagine anything today that would qualify as a surge in demand that would compare to WWII cultural shifts.

Keep in mind that the actual numbers are adjusted for inflation and are national averages. It’s the trends that count more than the actual average sale price.

What are your thoughts when you look at this chart?

Email This Post Email This Post    

{ 0 comments }

St. Louis Housing Market ~ 10 Year Trends

by Karen Goodman on April 4, 2010

in Market Conditions

When we talk about how the housing market is doing, it’s important to understand that single family homes and condos often have very different trends.

St. Louis County ~ 10 Year Trends:

Properties for Sale vs. Sold Properties:

Single Family Homes:

St. Louis County homes - for sale and sold chart

Condos:

St. Louis County condos - for sale and sold chart

Total Days of Market and Original Sale Price to List Price:

Single Family Homes:

St. Louis County homes - days on market and sale price-list price ratio

Condos:

St. Louis County condos - days on market and sale price to list price ratio

Months of Inventory:

Single Family Homes:

St. Louis County homes - months of inventory chart

Condos:

St. Louis County condos - months of inventory chart

Bottom Line:

When you look at the charts, you’ll notice that there is a difference in both the shape of the charts and also in the actual numbers – make sure to take a good look at the numbers on the left axis.

Condos sell in much smaller numbers, take longer to sell, and there is a huge difference in the months of inventory.

In the last couple of years, there has been a 12-24 month supply of condos at any given time. In comparison, single family homes have had between 6-10 months of supply during the same time period.

A 6 month supply of properties is considered a balanced market. Once the inventory levels drop, either because fewer sellers are listing their homes or because more buyers start purchasing the available homes, the housing market will stabilize. Clearly, the single family home market in St. Louis County will recover long before the condo market.

The result is that condo sellers need to price their properties very aggressively or they won’t find a buyer. Sellers who think that they can simply wait a year or two and try again are being unrealistic. Prices may still fall more before they hit bottom, and even when property values do start climbing again, they will most likely appreciate only 1-3% per year.

Property owners who are waiting for their $200,000 property to get back to the $240,000 level it was worth a few years ago, could be waiting 10 years.

Email This Post Email This Post    

{ 0 comments }

St. Louis Housing Market Reports ~ City, Zip Code or High School Reports

March 31, 2010

When I first created this website, I knew that I wanted to provide housing market trend data for my site visitors. For a couple of years, each month I would manually run data searches to create monthly housing market reports for each of the major school districts in the St. Louis region. The reports took [...]

Read the full article →

Housing Market Trends and the Economy

March 10, 2010

A few weeks ago I attended the Keller Williams 2010 Family Reunion. With over 8000 agents and real estate market center staff in attendance, Gary Keller spent the first morning giving his Vision Speech. One of the reasons I have been so happy with my decision to join Keller Williams is the fabulous education that [...]

Read the full article →

How Many St. Louis Homes Fail to Sell?

January 11, 2010

Over the last few weeks, I’ve been posting information to show you how the St. Louis housing market has been doing in the last few years. Earlier this month I published reports showing that the vast majority of homes and condos which sold in 2009 were priced below $200,000. Owners with higher priced homes have [...]

Read the full article →

What is the Appreciation Rate of St. Louis Condos?

January 11, 2010

Yesterday I posted charts showing the appreciation rate for homes since 1999 in the St. Louis area. I chose not to lump condos and homes together when putting together these appreciation rate charts, because the single family home market and the condo market do not necessarily have the same pricing trends. Condo sales have definitely [...]

Read the full article →