Two housing reports, two conclusions

Government data on home values is less glum of pair

By John Rebchook, Rocky Mountain News (Contact)

Wednesday, February 27, 2008

Two closely watched national housing reports released Tuesday draw vastly different conclusions about Denver-area home values in 2007.

The government's Office of Federal Housing Enterprises Oversight report shows only a 0.49 percent decline in prices for the Denver-Aurora market from 2006 to 2007, while the private S&P/Case Shiller report shows prices dropping by 4.5 percent.

The Case Shiller report shows a 9.1 percent decline for 20 U.S. cities last year.

The OFHEO report tracks 291 metropolitan areas across the country.

The Case Shiller report tracks only sales while the OFHEO report also tracks Fannie Mae and Freddie Mac refinances.

Lou Barnes, principal of Boulder West Financial Services, said the OFHEO report brings more "stability" to the numbers.

"In a market as tough as this one, you don't sell your home unless you have to," Barnes said. "You simply live in the house until the market improves. So a lot of the homes being sold are distressed homes, which distorts the market data."

Also, the Case Shiller report gives more weight to expensive homes, while the OFHEO doesn't, he said.

The OFHEO report showed a 1.37 percent gain in prices in 2007 for all of Colorado, compared with 0.84 percent for the entire nation.

However, over a five-year period, homes in Colorado rose 17.46 percent, compared with 41.37 percent for the nation, according to OFHEO. And since 1980, Colorado home prices rose by 270.2 percent, compared with 290.2 percent for the U.S.

Last year, Grand Junction, fueled by employment in the energy business, was ranked No. 3 in the U.S., with a 12 percent increase.

Only Wenatchee, Wash., and Houma-Bayou Cane-Thibodaux, La., did better, rising by 13.67 percent and 12.15 percent, respectively.

Economist Robert J. Shiller said his namesake index paints a gloomy picture for the 20 major markets it tracks.

"We reached a somber year-end for the housing market in 2007," Shiller, a Yale professor and chief economist at MacroMarkets LLC, said in a statement.

rebchookj@RockyMountainNews.com or 303-954-5207

One-year change 2006-07 in U.S.

Metro area 1-year % shift

Atlanta -3.4%

Boston -3.4%

Charlotte, N.C. 2.3%

Chicago -4.5%

Cleveland -6.3%

Dallas -2.4%

Denver -4.5%

Detroit -13.6%

Las Vegas -15.3%

Los Angeles -13.7%

Miami -17.5%

Metro area 1-year % shift

Minneapolis -8.0%

New York -5.6%

Phoenix -15.3%

Portland, Ore. 1.2%

San Diego -15.0%

San Francisco -10.8%

Seattle 0.5%

Tampa, Fla. -13.3%

Washington, D.C. -9.4%

Composite of 20 areas -9.1%

One-year change 2006-07 in Colorado

Metro area % shift Rank*

Grand Junction 12.03 3

Boulder 2.89 100

Colorado Springs 0.06 192

Denver-Aurora (0.49) 198

Pueblo (0.74) 203

Greeley (4.8) 254

• February 27, 2008

  11:34 a.m.

  Suggest removal

  BikerChick writes:

  ..
  Does the Rocky have a dog in this fight ?

  Does the Chamber of Commerce want builders and other sellers to sell more homes ?

  TOTAL and complete honesty is required here. Each and every one of us MUST look deeply into the mirror.

  The average home-buyer is NOT sufficiently wise to purchase a home in this DANGEROUS market.

  The Rocky has an abiding moral responsibility to warn anyone (other than savvy investors) who is "in the market." DO NOT BUY IN THIS RECESSION.

  The fat lady will sing in 2010. Prospective buyers are well advised to wait two years. As the recession (depression) does its thing, hundreds of thousands of innocent folks in Colorado will experience pain and agony.

  Let's not add to that.
  ..

• February 27, 2008

  12:42 p.m.

  Suggest removal

  Bob299 writes:

  The sky is falling, the sky is falling. Nice, bikerchick, nice.