“Crash, Correction or Chill” examines economic and real estate trends that offer insights into how deep housing problems can be.

Buzz: None of the 50 states have lost home prices in the past 24 quarters – that’s six years!

Source: My trusty spreadsheet looked at year-over-year house price changes for each state, as tracked by the Federal Housing Finance Agency’s quarterly indexes that date back 46 years.

Top line

The last time a state experienced a 12-month drop in home prices was the second quarter of 2016, and that was Connecticut alone. In fact, minus three quarterly price drops in the nutmeg state, the national streak would go back to 33 quarters, or just over eight years.

Historically speaking, this recent lossless price series for US housing markets surpasses the 23-quarter series that ended in 2006, just before the bubble burst in the Great Recession.


Accommodation is still “location, location, location”.

So try to ignore the comments on the national market because local housing looks quite different, even when “local” is simply each state’s market.

History tells us that price losses by state are more common than you might remember. By 1976, the average quarter had eight states with prices below 12 months earlier. But the loss count varies widely.

Connecticut’s 61 drops in 186 quarters are the most among the states. Then comes Rhode Island (53), New Hampshire (48), California (46) and Maine and Massachusetts (44).

Less? Kentucky’s 16 followed by Iowa and North Carolina (17), Nebraska (18) and Indiana and South Carolina (20).

The housing crash of the Great Recession led 50 of the 51 states monitored (including Washington DC) to a drop in prices in two quarters of 2010.

And the losses were not only seen in the bubble burst era of the 2000s. Seven states on average suffered losses in each quarter between 1976 and 1999.

Conversely, 31% of the time, no state losses have been reported in the past 46 years.

Bottom line

The current lossless streak looks in jeopardy as mortgage rates rise, purchases decline and recession fears grow. And California has a habit of anticipating real estate curves, up or down.

So is it a crash, a fix or a thrill?

It looks like a sign of at least one “fix” on the way. We are apparently overdue for price adjustments, regardless of what is high or low with mortgage rates, jobs or the economy.

Look, price drops aren’t good or bad. They are just part of the ups and downs of any market. Depreciation is often a necessary event to keep prices – not to mention the mentality of homeowners and hunters – in line with economic reality.

And we have certainly had a shortage of price drops in recent years.

The stranger

Between 1976 and 1999, there were only five quarters in which no state experienced a 12-month price loss. Since then, there have been 53, enveloped by a housing market crash.

Is this gap in a curious measure of home tranquility simply a random pattern?

Could this shift in volatility be the result of shifts in the big picture from housing economic stance to demographic swings to manipulation by policymakers?

Or has housing’s well-known habit of being a boom or bust asset just gotten wilder?

Jonathan Lansner is the business columnist for the Southern California News Group. He can be contacted at [email protected]

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