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Another prediction that California metro area price peaks won’t return until 2025
By Kelli Galippo • Oct 4th, 2010 • Category: real estate newsflash
Home prices in most of California won’t return to the peak levels seen in 2006 until 2025 or later, according to a study by Fiserv. The data reflects an unprecedented real estate market cycle period of over 15 years.
Fiserv made more specific predictions for certain major cities. They posit the return of peak prices won’t occur until:
* 2022 in Santa Ana;
* 2024 in Oakland;
* 2024 in San Diego;
* 2026 in Los Angeles;
* 2028 in Fresno;
* 2032 in Riverside; and
* 2039 or later in Sacramento.
Predictions were calculated using the Case-Shiller Home Price Index (owned by Fiserv), which collects data on single family homes with at least two arms-length sales. Sales pairs for each home are compared, and any price change contributes to establish an equilibrium price trend.
In order to accurately measure changes in the value of a residential real estate market rather than changes in the value of an individual home, each sales pair is assigned a weight based on the price change and the home’s location.
Other factors considered in the data analysis include price anomalies, turnover frequency, time interval between sales and initial home value. Price peak recovery predictions were created using historical trend data and supplemented with data from the Federal Housing Finance Agency (FHFA).
Editor’s note — All of these predictions were compiled in March 2010 before the new homebuyer tax credits temporarily boosted home sales by pre-selling homes to otherwise future buyers.
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Recycle your electronics
On Sunday 1/9 between 10am and 4pm the Alameda High School Ski Club will have an electronics recycling day. Start the New Year off by getting rid of you old electronic stuff.
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