Home Prices Plateau

OFHEO came out with the quarterly stats for Q2 of 2008. I plugged the figures into the charts. Here is the results for our ongoing appreciation chart:


As you can see, we are in a dramatic return to pre-boom appreciation rates. In fact, the rates of changes are equal on both sides of this most recent boom. Certainly a lot different than the boom in the 90's when it took a few years to get back to a buyers market. In our current instance we are talking a matter of months from top to bottom.

If we do go negative on house prices I anticipate it will be minimal. Probably around the 3%-5% range if at all.

Here is the price chart. This chart tracks $1 of real estate bought in 1986 and what it would be worth now factoring in appreciation rates over time:


If you zoom in on this chart you can see that we are just at the cusp of a plateau in pricing. 1999-2000 saw a minor dip in prices. We might see a similar correction again this time.

Note: WE WILL NOT SEE A CALIFORNIA STYLE PRICE DECLINE. There are folks out there predicting a doomsday scenario. The fundamentals don't indicate that will be the case. See Utah's Crash Proof Fundamentals for details on why.