Some home prices won't recover until the 2030s

[Newsjock]

Source: CNN

Move over, Cleveland. Make room, Detroit. Beat it, Buffalo. There are some competitors for the title of America's most depressed real estate market.

These are not old Rust Belt post-industrial cities, where the manufacturing economy vanished years ago; these cities were flourishing as recently as 2005. But they got crushed by the housing bubble, and most won't recover from the damage until at least 2030.

... Celia Chen, a housing market analyst for Moody's Analytics, ... estimates that Las Vegas home prices won't return to their pre-recession peak until after 2032; in Phoenix, the rebound will take until 2034; and Salinas, Calif., and Naples, Fla., won't come back until sometime around 2038.

And these are nominal prices: Inflation-adjusted recovery will take even longer.

... "Nationally, we expect U.S. to recover by 2021," said Chen.

Read more: http://money.cnn.com/2011/01/07/real_estate/home_prices_depressed_for_decades/

[DrDan]

1. kind of implies that the peak was artificially high in 2005, doesn't it?

[dkf]

2. Yup. People were flipping homes for goodness sakes.

The speculators were going hog wild and those weren't wall street types but the average Joe deciding to go entrepreneur.

[Donnachaidh]

5. oh yeah

When a relative was told her home in a cheesy area of the San Fernando Valley was worth 500K at that time, I knew it was a scam. That was about 2 and a half times the *actual* value of the home.

[lunatica]

3. That's 22 years from now and a stupid prediction to boot

How does this shit even make it into the news. And 11 years just to recover? Recover from what? The banks and mortgage companies artificial bubble? Did she say how this was going to happen?

[soryang]

4. Are wages going up? Is MERS going away? Interest rates?

I think this is a reasonable prediction. Homes with cloud on title will take at least 20 years to clear up and rejoin the normal market price structure. Interest rates can't any lower. Wages suck.

What about the demographic bubble of persons in their late fifties and sixties that need to get rid of their homes? Who can buy that many homes? Prices will stay low for a long time.

[WinkyDink]

6. I predict no-one will remember her prediction by 2021.

[Javaman]

8. You're being kind. I predict no one will remember her prediction next year. nt

[enough]

7. Japan's housing prices have been dropping for twenty years. It can happen.

Fantastic interactive chart here:

http://blogs.reuters.com/felix-salmon/2010/01/12/house-price-chart-of-the-day/

It took me a minute to get the hang of this chart. Check out "Prices in Real Terms," and "Percent Change." Slide the bar for different time-frames.

[mmonk]

9. Nobody really knows. Unless they have a working crystal ball that is.