June 14, 2019
Where Has Real Estate Struggled Since the Bubble Burst in 2008?
While we are all wary of a new recession—with memories of the so-called “Great Recession” that began in 2008 with the burst of the real estate bubble still echoing in our collective consciousness—it’s safe to say that for the most part the housing market has rebounded from that event, with prices in some places now even greater than their previous highs in 2006. And current forecasts seem to indicate that any coming recession is likely to be mild by comparison to that chilling event. A February LendingTree report, which took a look at the ongoing fallout from the 2008 crisis through the lens of data collected from the 50 largest metro areas in the United States, came to this conclusion too—but with a certain number of caveats for particular regions—and also took a look at the changes in unemployment and income rates over the past decade.
First, the good news: the median increase in home value across the nation has increased by $50,000 since 2009, when we were in the grip of the recession. This is mainly as result of falling unemployment rates and increased income.
Among the 50 cities examined, only four have seen falling housing prices since 2009, with an average decline of $6,700: Baltimore, MD; Chicago, IL; Virginia Beach, VA; and Hartford, CT. The reasons for these declines are multivariate, but can generally be chalked up to falling employment in these areas and resulting out-of-state migration.
Of the other 46 cities, the three markets that have gained the most value since 2009 are all in California: Los Angeles, San Jose, and San Francisco. In these places housing price figures have gone up by six digits, averaging out to a $243,600 increase. Generally these rises are attributed to the presence of high-performing tech players such as Google and Apple.
Here at Topouzis & Associates, P.C., we do extensive title search work and perform curative services on every form of real property, so that a buyer or investor knows for sure that they are getting into a parcel with clear title. Contact us if you have any questions or if you would like our considerable experience in dealing with the particularities of the real estate system.