Tuesday, May 27, 2008

Price index envy

Big surprise, home prices dropping in Atlanta. One of the few cities with home prices that aren't dropping? Charlotte, that fallen lady up I-85 that stole all our banks. Not that I'm bitter.

Charlotte gets on my nerves. As Atlanta chokes on congestion and mismanagement, Charlotte keeps nipping at our heels. They already surpassed us as the Southeast banking capital, and they've done a much better job with transportation infrastructure in recent years. Even though I thought the NASCAR Hall of Fame was stupid, and even though Charlotte got it because of its hometown status, it still pissed me off.

What is in the water there that makes them the only major metropolitan region in the entire country not to drop in home prices over the last year? A quick review of the historical prices suggests that Charlotte and Atlanta partook about equally in the housing boom - neither got ridiculously inflated like most other cities. You typically see the 20%+ drops in cities that had equally outrageous increase, unlike Atlanta and Charlotte. You can see this on the graph to the right, showing both Atlanta and Charlotte against the composite indexes for other major metropolitan area since 2000. Both cities peaked at about the same place. I would need to know more about the Charlotte market to really say more.

Overall, Atlanta's drop of 6.5% is about half the nationwide average of 14.1%. I would also love to see a breakdown of home prices to compare urban/intown prices and suburb/ex-urb prices.

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