US median condo prices fell on average 19.2% during the period between the second quarter of 2008 and the second quarter of 2009, according to recently released data by the National Association of Realtors (NAR).
However, there was a large variation in annual condo price changes across US metropolitan markets over that period. In particular, among the 57 metropolitan markets covered by the NAR data, annual changes in median apartment condo and co-op prices ranged from +2.6% in Virginia Beach-Norfolk-Newport News, VA-NC, to -54.1% in Las Vegas-Paradise, NV.
Median condominium prices declined in all metropolitan markets tracked by NAR, but four (the "good"), which actually registered increases over the period Q2 2008 to Q2 2009. Twenty seven markets registered price declines of less than 10%, while twelve markets (the "bad") registered declines between 10% and 20%. Finally, fourteen markets (the "ugly") registered annual condo price declines in excess of 20%. The "good", the "bad" and the "ugly" markets and the respective changes in median condo prices are presented in the graphs below.
We emphasize that we are using these groupings of markets just to make the story more interesting, not to imply anything from a real estate investment strategy point of view. From a strategic point of view investors need to understand in addition to annual declines and the recent short-term dynamics of condo prices. It is emphasized that these groupings by no means reflect the dynamics and momentum of condo prices in the second quarter of 2009 , and may be quite misleading from that respect. Such dynamics are captured by the changes in prices that occurred within the quarter, which can not be assessed from the data provided by NAR, as they are seasonally unadjusted. Such trends will be more clearly and accurately revealed by the FHFA Housing Price Index for the second quarter that will be released soon.
Figure 1. Changes in Median Condominium Prices, Q2 2008-Q2 2009: The "Good"
Sources: NAR, Property-Investing.Org
Figure 2. Changes in Median Condominium Prices, Q2 2008-Q2 2009: The "Bad"
Sources: NAR, Property-Investing.Org
Figure 3. Changes in Median Condominium Prices, Q2 2008-Q2 2009: The "Ugly"
Sources: NAR, Property-Investing.Org
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