Thursday, November 14, 2013

Housing: Before and After the Great Recession

It's hard to summarize the contradictory trends contained in the Census Bureau's report, Home Value and Homeownership Rates: Recession and Post-Recession Comparisons from 2007-2009 to 2010-2012. The report is one of the first with three-year estimates and comparisons from the American Community Survey, which replaced the census "long form" and provides demographic and socioeconomic data for small geographic areas.

At first glance, the report seems to show that the Great Recession and the collapse of the housing market passed millions of Americans by without creating so much as a statistical ripple. For example, in the great majority of the nation's smaller counties (the 1,038 counties with populations of 20,000 to 65,000), the bureau found no statistically significant change in median home value or homeownership rate between 2007-2009 and 2010-2012. Only 12 percent of American live in those smaller counties, however, making their stability a minority perspective.

In the 50 most populous counties, the story is different—median home values fell in most areas and the homeownership rate took a hit in all of them, the bureau reports. A larger 30 percent of Americans live in these counties, and their struggles are well known. The collapse of the housing bubble is readily apparent in the steep decline in median housing value in Contra Costa County, California (San Francisco), where median value fell by a stunning $141,500. Declines topping $100,000 also occurred in Los Angeles County and Clark County, Nevada (Las Vegas), among others. Even so, among the 50 largest counties a few saw home values rise even during the darkest days of the Great Recession. Median home value grew in Bexar and Travis counties in Texas (San Antonio and Austin) and Allegheny County in Pennsylvania (Pittsburgh).

Perhaps the report's ultimate meaning can be summed up by the old real estate axiom: location, location, location.

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