Tuesday, August 26, 2008

Local New Construction, National Existing House Prices: Both Low

Local News

C-ville
is reporting today on the dire stats of the new housing construction market:

Albemarle County released numbers for the first part of 2008. 266 building permits for new residential housing units were issued in the first six months of 2008. This puts 2008 on target to meet the lowest number, yearly, since 1990, when anybody started keeping tabs. The record lowest number was 569 in 1995. The highest was in 2003 with 1,720 permits issued.

What did County BOS member David Slutzky say recently? Oh, yes: "The real estate market stinks."

National News

The Case-Shiller Index numbers have been released for June. This Index, from Standard & Poors, is considered by economists to be the most reliable indicator of American home values. C-S covers 20 metropolitan areas, and only previously owned, single-family homes are included in the survey.

On an annual basis, prices are still plummeting at record levels. In June, home prices in the 20 cities in the index were 15.9 percent below their level in the period a year ago. Read more here.

[Update] The insightful ones over at CalculatedRISK have more to say on this issue:

"In real terms, the Case-Shiller National Home price index is off 25% from the peak. Real prices are now back to the Q4 2002 level (nominal prices are back to mid-2004)."

THEIR PREDICTION?

"With existing home inventory at record levels, and tighter lending standards, prices will probably continue to decline over the next few years - perhaps another 15% to 25% in real terms on a national basis."

Be sure to click over there to see the compelling charts and graphs.

2 comments:

Anonymous said...

Not hard to believe that there are only 266 building permits for this year. Why would there be any more construction? There are so many empty new places available and so many that are overpriced it's a joke.

That detail in the cville story, 17,000 new units being approved since 2000. WTH. Were we suddenly getting an influx of creatures from outer space? Who was supposed to live in all the places?

More to the point where were the jobs supposed to come from to support the new owners or renters. The storybook "albemarle place" or the fabled south of town Wal-Mart I guess.

Charlottesville may be little but it has the delusions of grandeur of a much bigger city. Its hard to live here sometimes.

rentingnow said...

i've actually started to save $ for a downpayment since i started reading this blog & the finance links. CalculatedRisk is a favorite now. of course i like their prediction for *nationwide* drop in housing prices. but if you read through their comments there are lots about how high interest rates will be if there's a GSE bailout. since i still have several years left to rent at least i get to watch what unfolds without worrying about my property.