Tampa Bay: Starting the New Year in a deep, deep housing hole
It's a stark reminder to start 2010 but here's the tough fact of the matter. Tampa Bay home priceshave dropped more precipitously from their peak than Las Vegas, Phoenix, Miami and Detroit in the 20-city Case-Shiller housing index. I realize this is hard to read so here's a larger version at CalculatedRiskBlog.com showing Tampa Bay home prices have dropped 41.4 percent from their peak through October 2009.
In Las Vegas, house prices have declined 56.3 percent from the peak. At the other end of the spectrum, prices in Dallas are only off about 5.4 percent from the peak - and up slightly in 2009. Prices have declined by double digits from the peak in 18 of the 20 Case-Shiller cities. Here's more detail.
The latest monthly numbers are discouraging. Home prices fell 1.6 percent from September to October, erasing modest gains from June to August, according to the S&P Case-Shiller home price index. Tampa Bay was the top price loser among 20 housing markets on the October index. Here's St. Petersburg Times housing reporter James Thorner's closer look and here's a link to his housing blog.
For Tampa Bay, it's a double-edged sword to lose such a fantastic sum of housing values so quickly. The good news is such drastic repricing of Tampa Bay housing suddenly makes this area a home-competitive market again after years of housing prices soring beyond the reach of area incomes. The bad news is such a massive loss of home equity for existing homeowners has grotesquely diminished the financial cushion of hundreds of thousands of people in the Tampa Bay area alone. And the idea of new home construction in this market seems silly, though there may be small pockets of opportunity to the smart builder.
Translation: We face years of rebuilding our regional wealth.
-- Robert Trigaux, Times Business Columnist