One of the more prominent indexes that track home prices across the U.S. released their latest report this morning. Standard and Poor's/Case Schiller 20 city index fell by a record 18% from October of 2007 to October of 2008. Their 10 city index fell 19.1%. While it might not make us feel better, Seattle real estate continues to weather the storm well.
On a semi-bright note, Seattle only fell 10.2% year over year in October. This was the first double digit loss for our city since the inception of the index in 2000. Of course, October was one of the worst months in history for U.S. stock markets and President Bush was forced to sign a $700 billion bailout plan to help ease the global financial panic. Since then, the Federal Reserve has slashed interest rates and helped drive down mortgage rates to historic lows.
Many people lost significant sums of money in their investment portfolios during the huge market declines in October. In some cases, it only took a week to lose 40-50% of a persons nest egg. That makes 10% loss in home value look benign. As a Seattle real estate agent, I admit I am biased. But using real estate as an investment vehicle is a wise and proven method. Not to mention, it's not as volatile as the stock market can be.
Read the full article here.
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