The nation’s home prices finally topped the record prices reached just before the last major recession. (AP Photo/Gerry Broome, FIle) NYBZ202
Real estate history was just made as U.S. home prices finally topped the record prices reached just before the last major recession.
The national comeback only took a decade.
But it happened. That rebound is worth pausing to celebrate given a housing market concussed for far too long. The recovery has accelerated most recently thanks to tighter inventories of homes for sale and low interest rates.
So says the Case-Shiller U.S. Home Price Index, announced Tuesday, which captures home pricing data across 20 major U.S. metros to help come up with a nationwide figure for home prices.
That’s the good news.
Here in Florida and in the Tampa Bay market, we’re not there. Not yet.
We have not seen home prices reach the levels they soared to in the Sunshine State in 2006 — just before the housing bubble burst, driving housing prices down by 40 percent or more by 2011. That ugly event plunged millions of Florida homeowners into foreclosure after purchasing houses near the 2006 price peak.
The new peak just declared by the S&P Case-Shiller index marks a shift from the housing recovery to the hoped-for start of a new advance in home prices, says David M. Blitzer, a managing director at S&P Dow Jones Indices.
"While seven of the 20 cities previously reached new post-recession peaks, those that experienced the biggest booms — Miami, Tampa, Phoenix and Las Vegas — remain well below their all-time highs," he said.
Maybe. But the recent surges in Tampa Bay home prices already are knocking many first time buyers out of the market — or sent them packing to more distant neighborhoods in search of cheaper housing.
Around Tampa Bay watercoolers, tales of housing affordability woes are multiplying. Recent federal figures show personal income in Florida grew 3.6 percent in 2015 to $44,429. That’s decent growth. But that growth in income trails the nation’s average income. And it pressures Floridians chasing home prices rising at a far faster clip.
Of course, housing’s rebound has cheered existing owners, especially those who have recovered some equity after being underwater so long on their mortgages.
Related: How long can the good times roll for Tampa Bay’s housing market for the bubble pops?
Many of us may remember how the median house price in this state nearly doubled to $250,800 in July 2006 from July 2001.
Fast forward. The latest numbers show Florida’s median sales price, as of October, stands at $220,000, up nearly 12 percent in the past year.
Barring a sharp slowdown, Florida’s rising median home prices could blow by the 2006 peak within the next few months. That should further boost confidence in the state.
Many economists expect the Federal Reserve to start nudging interest rates up in December. That would make homes less affordable to those who borrow money and might slow the pace of higher prices.
Now throw in the wild card of a Trump presidency. No one with a real estate crystal ball seems sure yet where that may take us.
This much we do know. With home ownership in this country near a five-decade low, a few more home buyers wouldn’t hurt.
Contact Robert Trigaux at firstname.lastname@example.org. Follow @venturetampabay.