from the new west blog
Wyoming, Utah and Montana Lead in Home Appreciation
By Matthew Frank, 5-23-08
Homes in Rocky Mountain states are appreciating faster than anywhere else in the country.
Wyoming (6.34 percent change), Utah (5.58) and Montana (4.91) are on top, according to the Home Price Index report (opens PDF) released yesterday by the Office of Federal Housing Enterprise Oversight. Idaho is No. 19, Colorado No. 23.
The top 20 cities in home appreciation include Grand Junction, CO at No. 2 (9.08 percent); Billings, MT at No. 5; Provo-Orem, UT at No. 6; Ogden-Clearfield, UT at No. 9; Logan, UT-ID at No. 15 and Idaho Falls, ID at No. 16.
Countrywide, the picture is bleak. Prices fell in the latest quarter in 43 states. Over the past year, prices fell 3.1 percent—the largest decline in the index’s 17-year history.
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Comments
It's no wonder the market in these states is taking longer to fall; consumers have no reliable data to look at. The best we can do is estimates of sales prices by services like Realtor.com, which are based on loan values.
Even for disclosure states, it's important to take the OFHEO data with a grain of salt. It includes appraisals done for refinancings and excludes homes > $417,000. In addition, unlike the Case-Shiller Index it's based on median price, not the re-sale value of a particular home over time. http://blogs.wsj.com/economics/2008/02/26/ofheo-vs-case-shiller-a-primer/
You're right about OFHEO being based on repeat sales, not median prices http://www.ofheo.gov/hpi.aspx?Nav=269 Thanks for pointing that out. Still, the data is really flawed since it includes refinancings and excludes homes over $417,000.
Given these shortcomings in the OFHEO data, the best indicator of what's happening (or about to happen) in mountain west markets like Missoula is the Case-Schiller data for Seattle and Portland. Denver is also in the region of course, but it fell early and hard. Most folks thought Portland and Seattle would never fall.
According to today's Case-Schiller data, in Seattle, "Prices of single-family homes have fallen about 6.5 percent from their peak in July 2007 to February." http://www.nytimes.com/2008/05/28/business/28home.html?hp
Prices in Portland fell 2% from Feb 07-Feb 08 http://portlandrealestateoutsider.blogspot.com/2008/04/portland-home-prices-continue-falling.html
Given that, the best indicator of regional housing market trends is probably the Case-Schiller index for Seattle and Portland, which are not only nearby but were also thought unlikely to fall. Since Feb 2007, Seattle prices are down 4% and Portland is down 2%.
Today I saw a great article on Montana housing prices http://www.dailyinterlake.com/articles/2008/05/22/news/news03.txt Turns out realtors and appraisers do agree there is a downturn not only in volume but in price. Now if we only had house price disclosure in MT and other western states, consumers could find out just how much prices have fallen!
http://www.usnews.com/blogs/the-home-front/2008/05/29/next-housing-market-to-crash-seattle.html