San Diego Housing Bubble News and Analysis

I'm making this "sticky" at the top of the housing market forum topics list because it's so awesome and I don't want anyone to miss it in the wake of SuperBowl Sunday. Nice work as usual, esmith. (I'll unstick it in a couple days.)

Perhaps people might find it instructive to look at this in combination with the November Case Shiller numbers to get an idea of where the "official" numbers may be headed: http://piggington.com/november_case_shil...

For the most part it looks like a continuation of the trend, though a couple mid-level areas stabilized in esmith's data.

Also interesting that the supposedly invulnerable "coast" region has been on a pretty steady decline of late. That's the last bastion for the bulls.

If anyone wants to see a bigger version click the image then click "original."

Rich

Tweaked my regions a little bit: split 92127 into "old" Rancho Bernardo and "new" 4S/Del Sur/Santaluz. Dropped Poway (very eclectic city with houses from $400k to $5 million and no obvious way to divide it).

Same thing but showing appreciation vs. 7/2000:

Now taking mortgage interest rates into account. (in a rather ad hoc way) Again 100% corresponds to 7/2000.

Love the update.

I have a question regarding the Case-Shiller HPI. I've been reading through the methodology, found at http://www2.standardandpoors.com/spf/pdf... and came across the following on page 5, "The S&P/Case-Shiller indices do not sample sale prices associated with new
construction, condominiums, co-ops/apartments, multi-family dwellings, or other properties that cannot be identified as single-family."
Is this intended to mean the index excludes ALL condos, or only newly constructed condos? I read it as meaning the first.

It excludes all condos.

Very nice charts, esmith. But why change the colors on the last plot? It confused me quite a bit until I figured it out.

Where does La Jolla (92037) fit into your divisions? Coast?

Interesting. So this index is looking this bad and it doesn't even include much of the lowest value/fastest dropping part of the total housing market.
Thanks for confirming that for me.

Very nice. Is there any chance that you would be up for sharing the source code that you used to implement the algorithm? Sorry if this has been asked already (I skimmed all the past comments but may have missed it).

92037 is in the "coast".

twm: check this out

http://sdhpi.blogspot.com/2008/02/constr...

Thanks, you rock!

February: another month of declines; 27% off the peak

http://sdhpi.blogspot.com/2008/03/februa...

Nice graphs and map esmith.
From your second graph on the link...are you interpreting the picture that you paint there to mean that lower and middle tiers are about to overshoot what you consider a reasonable target, given current interest rate environment?
Thanks

It certainly appears that way. But maybe I got the long-term reasonable target wrong. My basic assumption is that "fortress" wasn't overpriced in 2002 (yet). Some people may disagree with that.

Isn't is best to go back to the fourth graph on
http://piggington.com/another_bad_month_...

to look for a clue as to when prices were 'correct' : ie not over or undershot for a period of normal mortgages. That tells me something like late 99; but projected for the very long term trend 'real' growth in house and land prices (ie trend above inflation) the 'normal' price level may well been something like 2002 prices

The big time trouble is, the market will probably undershoot that level; perhaps by a substantial . Longer term buyer won't then worry so much though for they can wait for the knife to bounce!

Esmith,
Interesting. The target seems reasonable enough to me.

"The big time trouble is, the market will probably undershoot that level; perhaps by a substantial . Longer term buyer won't then worry so much though for they can wait for the knife to bounce!"

At least some areas are going to overshoot the target esmith has proposed even if we don't have an extreme recession. That is already self evident.
I think there are some areas from the middle tier,for instance Poway's housing stock that meets middle tier criteria and perhaps most "Fortress" zones that will not overshoot or not by so much, dependent on the economic resiliency or lack of in San diego going forward.