May 9, 2008

Historical home prices by state

Previously I posted about How fast do homes appreciate historically? and then I added some more on the topic with More on historical home appreciation. In summary between the two posts I found that historical home appreciation is in the 4% rate. However that is a national figure covering the average for the entire USA.

I found this Census page with Home values per state for the 1940 to 2000 census. From that I can figure the average annual appreciation per state over the 60 year period from 1940 to 2000. The values per state are:

New Mexico 8.9%
Alaska 7.7%
Arizona 7.7%
Colorado 7.6%
Nevada 7.4%
Washington 7.4%
Idaho 7.2%
Arkansas 7.2%
Oregon 7.2%
Utah 7.1%
Montana 7.1%
Louisiana 7.1%
North Carolina 7.1%
Mississippi 7.1%
California 7.1%
Georgia 7.0%
Oklahoma 6.9%
New Hampshire 6.8%
Alabama 6.8%
Tennessee 6.8%
South Dakota 6.7%
Maine 6.7%
Texas 6.7%
Massachusetts 6.7%
Kansas 6.7%
Maryland 6.7%
Virginia 6.7%
Florida 6.6%
North Dakota 6.6%
Wyoming 6.5%
South Carolina 6.5%
Kentucky 6.4%
Hawaii 6.4%
Nebraska 6.4%
USA 6.4%
Minnesota 6.4%
Michigan 6.4%
Illinois 6.3%
Vermont 6.3%
Indiana 6.3%
New Jersey 6.2%
Missouri 6.2%
Iowa 6.2%
Connecticut 6.2%
Wisconsin 6.1%
Rhode Island 6.1%
New York 6.0%
Delaware 5.9%
West Virginia 5.9%
Ohio 5.9%
Pennsylvania 5.8%
DC 5.2%


You can see that there is a pretty wide spread between states. Depending on what state you are in you might have up to 2.5% difference in appreciation compared to the national average. And comparing one state to another the swing is as much as 3.7%.


Furthermore the change in any given decade may vary considerably from state to state. For example in the 1940's prices went up 24% in New Mexico but only 6% in D.C. a variation of 18%. And then in the 1990's the prices rose 8.4% in Oregon but dropped 0.6% in Connecticut. In every decade there was at least a 7% difference between the state with the highest and lowest annual appreciation values.

So if you are looking at trends of home prices, it really makes much more sense to look at the local since there is a pretty significant difference in price trends from one state to another.
Furthermore it really makes most sense to look at the specific city or metro area, but data for that can be harder to come by. I'll see if I can find anything price trends for metro areas.

8 comments:

  1. Thanks so much for this info! I have been looking for historical data on home prices for a long time. Everyone is so focused in the last quarter, the last year, the last decade... and it I couldn't find the historical info until I found your blog. Thanks!!

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  2. Hi, I'm happy that you found it helpful.

    Jim @ FreeBy50

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  3. Hi!
    I have a question regarding historial home appreciation on a home I purchased this past spring in a town 30 mi. south of Boston. Because it continues to lose value, I am trying to determine the historical trendline of this home to predict where the bottom might be and how far back in time will the wipe out in gains go? 2003? 2002? The home was built in 2001 and sold for 350K. Using an historic trendline of home appreciation at what % gain per year, how much (conservatively) should it be worth today?

    Your response is greatly appreciated!

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  4. Predicting what home values will due in the next couple years is anyones guess. Any amount of past data won't tell us what will happen in a year or two with any real accuracy. So I wouldn't put too much into any predictions based on past trends.

    One source you might find useful is the Zillow.com website. If you go there you can plug in your home's address and they will estimate your home value. They also have a graph of the home value over the previous 10 years. Keep in mind its just an estimate and its based of comparable home sales in your area.

    I don't think looking at historic appreciation will be of much use. The historic appreciation is just an average. If you look at the historic rate for an area and plot it over a few years its not going to be too accurate. The values bounce up and down from decade to decade or year to year. Looking at the state of Massachusets they've had appreciation of about 2.5% from 1940 to 2000. But thats not close to a steady increase year over year. From 1980 to 1990 home values doubled in Mass. Then from 1990 to to 2000 values dropped around around 10%.

    Also just for reference, I found a website with prices for various Mass. communities over the period 2001 to 2005 :
    http://www.boston.com/business/globe/articles/2006/04/07/median_housing_prices_chart/

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  5. You've provided some good information, but if you are using the median values of the houses in each state to make the comparison, you're not actually measuring the increase in value of an individual home, so it is less relevant to individuals. Most of the states with high levels of appreciation are in the South and West and experienced high levels of growth, so they have many newer homes. New homes are more expensive and thus have higher values, which will drive the median value up. So as a measurement of how much my individual home appreciated (or will appreciate), this data is not optimal. If you could get data on the median value of homes built prior to 1940 and compare that to the value of the same homes in 2000 you'd have a good measure of appreciation.

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  6. Kent, Good point, median sales figures could be subject to bias from a lot of larger newer homes being sold. But in general a rising market will bring up all home values relatively equally.

    Medians and averages are only as good as looking at the big picture and individual home values will always have some variations. Also this data is for 10 year periods and it is state wide so its not vary granular.

    There is another measure of home values called the Case Shiller index which tracks sales increases of specific homes. So it measure the increase in value every time a home is resold. This would be a better direct measure of increase in value. Plus Case Shiller covers major city areas rather than just state wide data. I talk about Case Shiller index here:
    http://freeby50.blogspot.com/2008/10/s-case-shiller-home-price-indices.html

    I think if you compare the Case Shiller and general median values then I think you'll see that the median values are not far off.

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  7. I have found similar information on this site to be of great use:
    http://www.ofheo.gov/hpi.aspx

    The "House Price Index" is published by the govt and is calculated by state, region, and nationally. It is primarily used to track 4-quarter appreciation. The OFHEO site will allow you to compare states and regions, and you can download historical data going back to the 70s.

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  8. Johnny, thanks for the commend and the link to that government site. It looks like a good resource, I'll post another article about that page specifically.

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