America’s Most Splendid Real Estate Bubbles, February Update: Raging Mania in Phoenix to Cooling Condos in San Francisco
But the deals were made when mortgage rates were still 3%, not 4% like they are today.
By Wolf Richter for WOLF STREET.
In some cities, house prices continued their wild spikes, such as Phoenix, where prices soared more than 30% year-over-year for the sixth month in a row. In other cities, prices have only gone up, so to speak. And in a few cities, that push has slowed. Condominium prices in the San Francisco Bay Area started falling last summer and haven’t gone anywhere since 2018. That’s the range of America’s hottest real estate bubbles, as seen in the S&P CoreLogic Case-Shiller Home Price Index today.
The overall national index rose 0.9% in December compared to November, similar to the previous month. Compared to a year ago, the index jumped 18.8%, like the previous month. “Buyers may have rushed in anticipation of higher rates,” S&P CoreLogic said.
But house prices here do not yet reflect higher mortgage rates. Today’s “December” data is a three-month rolling average of completed sales that were recorded in public records in October, November and December, reflecting transactions completed roughly in September, October and November, when the average 30-year fixed mortgage rate hovered around 3%. On Friday, the average 30-year fixed rate was 4.08%, according to Mortgage News Daily.
All Case-Shiller home price indices were set at 100 for January 2000. The national Case-Shiller home price index, with a value of 279 for “December”, indicates that national home price inflation houses is now 179% since 2000. Over the period, consumer price inflation, as tracked by the CPI, increased by 67%. In Los Angeles, home price inflation since 2000 is now 279%, more than four times the rate of consumer price inflation.
Los Angeles Subway: Single-family home prices rose 1.0% in December from November. Although steep, it was the smallest month-over-month increase since August. Year-on-year, the index jumped 19.3%. This 279% house price inflation since January 2000 makes Los Angeles the most splendid number 1 real estate bubble on this list.
San Diego Metro: The Case-Shiller index climbed 1.8% for the month and 29% year-over-year. Since 2000, house price inflation has climbed 276%:
House price inflation as measured by the Case-Shiller index. The index’s “sales pair method” compares the selling price of a house when it sells during the current period to the price of same house when it sold out before, often years earlier. The data includes adjustments for home improvements and the passage of time between sales. By measuring the price movements of the same house, the index tracks the number of dollars it takes to buy the same house over time and thus measures house price inflation.
Seattle Metro: Home prices rose 1.5% for the month and 23.9% year-over-year. Since January 2000, housing price inflation in metro Seattle has soared to 258%:
San Francisco Bay Area: House prices rose 0.8% for the month, after almost flat in the fall. Year-over-year, prices jumped 18.8%:
San Francisco Bay Area: Condominium Prices for the month were unchanged, after falling for three consecutive months. Over the past seven months, prices have hardly budged. This reduced the year-over-year gain to 7.5%. Since June 2018, condo prices have only increased by 3.9%:
Portland Metro: Home prices rose 0.8% for the month and 17.9% year over year:
Miami Metro: Home prices jumped 1.8% for the month and 27.3% year-over-year, the fastest since February 2006, when Miami was nearing its epic housing meltdown:
Washington DC Metro: Home prices rose 0.4% for the month, narrowing the year-over-year gain to 10.5%, the slowest since January 2021:
Boston Subway: Home prices rose 0.7% for the month, after being flat for two months, narrowing the year-over-year gain to 13.4%:
Tampa Metro: +1.6% for the month, and hallelujah, +29.4% year over year, a new all-time high for this metro, even surpassing the peaks of madness during housing bubble 1 before it all went down. collapses:
Denver Metro: +1.1% over the month and 20.3% over one year:
Phoenix Metro: +1.3% for the month, taking the year-over-year gain to a new all-time high of 32.5%, even surpassing the peak of the crazy housing bubble 1. For months now, Phoenix has been the metropolis with the hottest year-over-year price spikes among our hottest real estate bubbles:
Las Vegas Metro: +1.0% over the month and +25.5% over one year:
Dallas Metro: +1.2% for the month, and a record +26.0% year-on-year:
New York subway: Housing prices +1.1% for the month and +13.6% year-on-year. With an index value of 255, the Metro has experienced house price inflation of 155% since 2000.
The remaining metros in the Case-Shiller index of 20 metros – Atlanta, Charlotte, Chicago, Cleveland, Detroit and Minneapolis – have house price inflation since 2000 of less than 150% and are therefore not eligible for this list of most splendid. housing bubbles.
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