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    • Western Cities Top U.S. Home Price Declines [view article]
      Interesting charts on city-by-city basis. What would be even more instructive would be the same charts, but adjusted for actual inflation during the same period. The charts as presented suggest that the bubble now has been retraced, with no more than a 10% decline from 1990 prices.

      If you assume, say, a 100% inflation rate during that period (the price of gold suggests an actual inflation rate of about 350%, incidentally), then housing has declined over the past 15 years or so by the full measure of the past year (40%). I suspect the real graphs would show slow, steady price erosion until last year, when housing fell off a cliff.

      The graphs in this article suggest a return to the mean and a bottoming today. Inflation-adjusted graphs would suggest a plummet into the abyss with much more plummeting to come....
      Feb 06 09:41 AM
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