As home prices begin to rise elsewhere, Balt. area still declining
Home prices were up in 40 percent of the nation's metro areas at the end of last year, compared with a year earlier, but Baltimore was not among them.
That's according to Fiserv, the company whose data is the basis of the popular Case-Shiller index. It shows prices in the Baltimore metro area declining 3 percent from the fourth quarter of 2008 to the fourth quarter of 2009.
But because Fiserv is forecasting a temporary return to falling prices in some of the rising markets, and big drops in regions already hard-hit by the bust, it thinks the nation as a whole will take a bigger cut on price than the Baltimore area in the near term. The company is predicting a 1.8 percent drop in prices over the 12 months ending in the fourth quarter of this year in the Baltimore metro area, compared with a 3.1 percent drop nationwide.
On the one hand, says Fiserv Chief Economist David Stiff, more consumers "have confidence that buying a home doesn't mean catching a falling knife." On the other: "The first-time homebuyer tax credit has expired, the Federal Reserve has stopped buying residential mortgage backed securities (MBS) and the projected number of foreclosures remains extremely high."
Homeowners in our metro area haven't felt the housing crash as keenly as wide swaths of Florida, California and other big-population states in the eye of the storm. You probably knew this already -- it's been the story since the slump was a mild little infant rather than a rampaging toddler -- but here's a comparison to put that in perspective:
Fiserv calculates the drop in prices from the end of 2006 through the end of 2009 at about 15 percent in the Baltimore metro area. Nationwide? Twenty-seven percent.
Orlando is at one extreme, with prices down so much they're about half of what they were at the end of '06. But in Austin, Texas, prices are 10 percent above their 2006 mark.
Closer to home, there's Washington, D.C., where home prices took a "rapid decline" after the bubble but are on the rise again, Fiserv says.
"Since the market bottom in early 2009, prices in this metro area have risen more than 9 percent," the company says in a press release, crediting "a relatively strong local economy" and "substantially improved affordability" after the earlier price drop.