It’s been 10 years since the peak of the U.S. home price bubble. David Stiff, for CoreLogic, notes that the CoreLogic Case-Shiller Home Price Index dropped 27% during the next six years after reaching its peak in July 2006. Now, the national index remains 4% below its peak.
But in certain markets, prices have rebounded nicely. In 40% of metros, prices are at new peaks and another 30% are within 10% of their previous peak.
Nationally, we will likely hit or surpass 2006 levels by next spring or summer. Both mortgage default rates and foreclosure inventories have fallen to their lowest levels in eight years, and the economy is generating about 2.5 million new jobs per year.
Stiff adds that the country should not fear another housing market crash in the near future because its current success is built on fundamentals, like job growth and rising demand. The pre-bubble housing market was very different. Although job growth was strong during the housing bubble years, much of it was driven directly or indirectly by real estate speculation.