Tuesday, December 29, 2009

Portland Home Values: Case-Shiller October Numbers

Portland home prices stayed pretty much stable in October and have essentially stayed stable for the whole of 2009 after eroding significantly in 2008.

The graph below is of the raw data and in it you can see the run up in values, the fairly sudden erosion and the bottoming out. The big question is, of course, will this bottom hold? I think that it will, but only if the economy doesn't go into double dip recession, which I think is unlikely.

Here is the graph of the year over year change in monthly home values since 2006. As is evident, we are still down but trending up.

The new homebuyer tax credit was certainly a part of the story but the traction that this had is likely to subside due to seasonal reasons, the cost of financing which is on the rise and the declining population of people who can take advantage of the credit. I imagine that values could decline in the winter months a bit but I think the substantial erosion is over. That said, if unemployment stays high, the erosion will start anew.

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