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December 2013
Summary Notes
Home price growth continued at a rapid rate and in all reported markets.
Sales decreased in most markets over the last month and quarter.
We discuss the limited role of sales volume on home price growth.
Home price growth was positive in all of the 42 reported counties over the last month, quarter,
and year.
Sales increased in 12 of the 42 reported counties over the last month.
Sales increased in 6 of the 42 reported counties over the last quarter.
Sales increased in 27 of the 42 reported counties over the last year.
Foreclosures decreased in 19 of the 42 reported counties over the last month.
Foreclosures decreased in 20 of the 42 reported counties over the last quarter.
Foreclosures decreased in 29 of the 42 reported counties over the last year.
Housing Outlook
Home prices growth continues across all reported markets at an unsustainable pace. This rate of growth
is not supported by the underlying economic fundamentals. Home price growth for the last year ranges
from minimum of 3.95 percent in Fulton County, GA to maximum of 32.74 percent in Sacramento, CA,
with an average across markets of 16.47 percent. In the past, moderate economic fundamentals have
supported long term home price growth rates of 3 to 4 percent. Nearly all reported markets are
experiencing home price growth in excess of the long term average. Current economic drivers, while
positive, are weaker than those experienced in most expansions. Further, considerable uncertainty
exists about future economic prospects and the impact of increasing government regulations in the
mortgage and housing market. The current elevated home price growth rates cannot continue without
increased risk of a substantial correction.
Factor
Comment
Current Situation
Supply of Housing
Uncertainty
30%
25%
20%
15%
10%
5%
0%
First (Highest Sales Growth)
Second
Third
-5%
-10%
Sales Growth
HP Growth
-15%
In markets in the first sales growth quartile, sales growth increased 30.5% over the last year and home
prices increased 12.3% over the last year. In second sales growth quartile, sales growth increased 14.5%
and home prices increased 12.3%. In third sales growth quartile, sales growth increased 1.1% and home
prices increased 18.3%. In fourth sales growth quartile, sales growth decreased 14.2% and home prices
increased 23.1%.
However, reduced sales are not the sole cause of the rapid home price growth we are observing. While
markets with stagnant or decreasing sales have extremely elevated home price growth, markets with
substantial sales growth over the last year are also experiencing home price growth rates that exceed
the long term average.
Two additional explanations exist for the elevated home price growth in nearly all markets.
One is that home prices have been correcting from an excessive downturn below fundamental
values that occurred during the great recession and continued as housing market participants
searched for a floor in home prices.
A more likely explanation is that some of the excessive, above-trend, home price growth is
speculative and characteristic of the formation of a new home price bubble.
County
MARICOPA
PIMA
ALAMEDA
CONTRA COSTA
LOS ANGELES
ORANGE
RIVERSIDE
SACRAMENTO
SAN BERNARDINO
SAN DIEGO
SANTA CLARA
DENVER
FAIRFIELD
BROWARD
DUVAL
HILLSBOROUGH
LEE
MIAMI-DADE
ORANGE
PALM BEACH
PINELLAS
FULTON
COOK
DUPAGE
MIDDLESEX
MONTGOMERY
OAKLAND
JACKSON
ST. LOUIS
MECKLENBURG
CLARK
QUEENS
SUFFOLK
CUYAHOGA
FRANKLIN
MULTNOMAH
SHELBY
DALLAS
HARRIS
SALT LAKE
FAIRFAX
KING
Metro
Phoenix
Tuscon
Oakland
Richmond
Los Angeles
Orange
Riverside
Sacramento
San Bernardino
San Diego
San Jose
Denver
New York
Ft. Lauderdale
Jacksonville
Tampa
Ft. Myers
Miami
Orlando
Palm Beach
Clearwater
Atlanta
Chicago
Chicago
Boston
Washington, DC
Detroit
Kansas City
St. Louis
Charlotte
Las Vegas
New York
Long Island
Cleveland
Columbus
Portland
Memphis
Dallas
Houston
Salt Lake
Washington, DC
Seattle
Notes:
1. Source: DataQuick
2. Reported sales data do not include new construction.
Current Month
142.6
122.7
146.5
145.3
186.1
173.6
149.6
133.6
166.9
155.4
163.9
141.0
129.1
146.0
127.8
137.0
126.2
152.4
132.4
140.1
137.2
132.5
114.5
126.2
134.6
159.7
99.3
106.3
106.3
121.4
116.5
142.1
138.6
98.6
106.7
169.2
106.2
131.2
131.2
124.9
168.9
167.9
Prior Year
118.5
110.9
116.0
117.1
151.7
145.1
116.0
100.7
130.2
126.3
137.2
125.7
116.7
121.8
110.9
115.4
111.4
130.8
109.4
118.2
116.4
127.5
97.1
111.0
121.2
147.0
80.5
94.9
94.9
112.7
88.5
133.7
132.4
89.8
94.4
142.3
91.5
121.7
121.7
110.6
156.5
134.4
Current Month
775
206
64
83
413
106
297
219
386
151
39
83
50
596
1105
512
324
518
236
395
430
297
845
162
15
14
208
226
229
370
680
20
66
365
329
74
297
432
654
110
21
232
Foreclosures
Previous Month
727
214
60
71
416
100
317
200
317
127
35
88
36
444
695
502
297
600
443
561
432
276
846
226
23
18
198
235
254
311
585
11
63
404
322
34
277
491
780
121
37
211
Prior Quarter
869
217
41
96
480
108
322
204
381
147
37
83
29
478
746
445
382
525
379
368
437
220
937
202
36
33
208
252
265
286
972
14
38
311
244
45
305
351
569
106
33
265
Prior Year
1896
326
182
251
1025
236
916
559
791
367
92
189
36
570
621
519
380
338
302
253
309
341
858
193
37
9
338
336
372
232
643
11
47
381
374
59
344
493
774
152
22
178
Current Month
5420
992
899
1033
4556
1909
2505
1733
2334
2199
1002
794
888
2189
1144
1550
1207
1671
1331
1550
1286
1168
2867
1071
971
584
1905
557
1326
1303
3132
553
1297
1290
1381
942
1036
1858
3481
715
616
2037
Sales
Previous Month
5423
1151
1209
1194
5526
2222
2472
1742
2158
2050
1168
971
917
2130
1349
1481
1304
1851
1631
1769
1393
1268
3657
1349
1426
771
1777
495
1525
1262
3314
434
1033
1504
1496
836
981
2069
4039
832
851
2056
Prior Quarter
6937
553
1115
1216
5232
2257
2864
2021
2543
2694
1175
1032
733
2431
1296
1790
1421
1710
1426
2043
1456
1304
2773
1185
1388
754
1567
642
1587
1588
3876
302
784
1439
1536
1083
1252
2085
3666
809
1148
2704
Prior Year
7413
867
1059
1154
4903
1889
3098
2316
2629
2499
1058
854
785
1981
1008
1573
1155
1403
1140
1451
1035
911
2403
760
853
463
1461
583
1139
1167
3330
345
950
996
1144
830
1091
1682
2940
775
541
2008
County
MARICOPA
PIMA
ALAMEDA
CONTRA COSTA
LOS ANGELES
ORANGE
RIVERSIDE
SACRAMENTO
SAN BERNARDINO
SAN DIEGO
SANTA CLARA
DENVER
FAIRFIELD
BROWARD
DUVAL
HILLSBOROUGH
LEE
MIAMI-DADE
ORANGE
PALM BEACH
PINELLAS
FULTON
COOK
DUPAGE
MIDDLESEX
MONTGOMERY
OAKLAND
JACKSON
ST. LOUIS
MECKLENBURG
CLARK
QUEENS
SUFFOLK
CUYAHOGA
FRANKLIN
MULTNOMAH
SHELBY
DALLAS
HARRIS
SALT LAKE
FAIRFAX
KING
Metro
Phoenix
Tuscon
Oakland
Richmond
Los Angeles
Orange
Riverside
Sacramento
San Bernardino
San Diego
San Jose
Denver
New York
Ft. Lauderdale
Jacksonville
Tampa
Ft. Myers
Miami
Orlando
Palm Beach
Clearwater
Atlanta
Chicago
Chicago
Boston
Washington, DC
Detroit
Kansas City
St. Louis
Charlotte
Las Vegas
New York
Long Island
Cleveland
Columbus
Portland
Memphis
Dallas
Houston
Salt Lake
Washington, DC
Seattle
Notes:
1. Source: DataQuick
2. Reported sales data do not include new construction.
Latest Month
1.39%
0.90%
1.80%
1.55%
1.53%
1.31%
1.94%
1.85%
1.95%
1.57%
0.73%
1.01%
0.76%
1.48%
0.68%
1.19%
1.13%
1.05%
1.40%
1.18%
1.31%
0.28%
1.18%
1.05%
0.86%
0.66%
1.80%
1.01%
1.01%
0.61%
1.82%
0.39%
0.24%
0.57%
1.28%
1.08%
1.29%
0.59%
0.59%
0.86%
0.63%
1.73%
Latest Year
20.28%
10.70%
26.24%
24.06%
22.62%
19.63%
29.01%
32.74%
28.26%
22.98%
19.51%
12.17%
10.56%
19.90%
15.26%
18.75%
13.36%
16.52%
21.01%
18.46%
17.82%
3.95%
17.96%
13.73%
11.04%
8.62%
23.35%
12.02%
12.02%
7.68%
31.63%
6.27%
4.69%
9.70%
13.03%
18.89%
15.98%
7.79%
7.79%
12.95%
7.96%
24.88%
Latest Month
6.60%
-3.74%
6.67%
16.90%
-0.72%
6.00%
-6.31%
9.50%
21.77%
18.90%
11.43%
-5.68%
38.89%
34.23%
58.99%
1.99%
9.09%
-13.67%
-46.73%
-29.59%
-0.46%
7.61%
-0.12%
-28.32%
-34.78%
-22.22%
5.05%
-3.83%
-9.84%
18.97%
16.24%
81.82%
4.76%
-9.65%
2.17%
117.65%
7.22%
-12.02%
-16.15%
-9.09%
-43.24%
9.95%
Latest Year
-59.12%
-36.81%
-64.84%
-66.93%
-59.71%
-55.08%
-67.58%
-60.82%
-51.20%
-58.86%
-57.61%
-56.08%
38.89%
4.56%
77.94%
-1.35%
-14.74%
53.25%
-21.85%
56.13%
39.16%
-12.90%
-1.52%
-16.06%
-59.46%
55.56%
-38.46%
-32.74%
-38.44%
59.48%
5.75%
81.82%
40.43%
-4.20%
-12.03%
25.42%
-13.66%
-12.37%
-15.50%
-27.63%
-4.55%
30.34%
Latest Month
-0.06%
-13.81%
-25.64%
-13.48%
-17.55%
-14.09%
1.33%
-0.52%
8.16%
7.27%
-14.21%
-18.23%
-3.16%
2.77%
-15.20%
4.66%
-7.44%
-9.72%
-18.39%
-12.38%
-7.68%
-7.89%
-21.60%
-20.61%
-31.91%
-24.25%
7.20%
12.53%
-13.05%
3.25%
-5.49%
27.42%
25.56%
-14.23%
-7.69%
12.68%
5.61%
-10.20%
-13.82%
-14.06%
-27.61%
-0.92%
Latest Year
-26.89%
14.42%
-15.11%
-10.49%
-7.08%
1.06%
-19.14%
-25.17%
-11.22%
-12.00%
-5.29%
-7.03%
13.12%
10.50%
13.49%
-1.46%
4.50%
19.10%
16.75%
6.82%
24.25%
28.21%
19.31%
40.92%
13.83%
26.13%
30.39%
-4.46%
16.42%
11.65%
-5.95%
60.29%
36.53%
29.52%
20.72%
13.49%
-5.04%
10.46%
18.40%
-7.74%
13.86%
1.44%