Professor Mark J. Perry's Blog for Economics and Finance
The chart above shows the quarterly OFHEO home price indexes from 1999:Q1 to 2008:Q4 for California vs. Texas, South Dakota Oklahoma, Missouri, Alabama and Arkansas (data here). Notice that only the state of California had a huge 2006-2007 real estate bubble followed by a subsequent correction. All other states have had steady increases in home prices, without any bubble, and without any subsequent correction/crash. 
Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan. Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
3 Comments:
Hmm, I live in San Antonio and my house just appraised for $15,000 less than I paid for it more than 3 years ago.
So you show a chart comparing a select group of states(I notice you left out Florida, Arizona, and Nevada) and come to the conclusion that California was the only one to experience outsized growth?
Since the 100 baseline is from 1980 we can determine from this chart that the states you did choose to include increased an amount equal to or greater than their increase from the 19 years between 1980-1999 in only half the time from 1999-2009.
You are just another economist making inaccurate claims based on your preconceptions.
How about making this chart really show something and provide a chart of YoY percentage price increases for all 50 states, say starting 1980? Even then I don't really understand your point since it was the type of loans just as much as the location where the loans were originated.
The MO statistics must be statewide and not limited to the metropolitan areas (St Louis & Kansas City). In the stix values stayed fairly consistent as there is no economic opportunity in those areas. In the metropolitan areas house prices rose at an annual clip somewhere in the neighborhood of 15-25% annually between 2000 and 2006. These markets will eventually revert to the mean.
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