Fitch: U.S. Home Price Growth on the Coasts Diverging

NEW YORK--(BUSINESS WIRE)-- Link to Fitch Ratings' Report: U.S. RMBS Sustainable Home Price Report (First-Quarter 2016 Update)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=881211

Disparate U.S. home price growth between New York and San Francisco is very much a tale of two cities, with the threads tying them together yielding very different conclusions according to Fitch Ratings in its latest quarterly U.S. sustainable home price report.

San Francisco home prices are now 15% higher than their peak in 2006 while New York prices remain 13% below their 2006 peak. Both cities are major metropolitan areas on the coast with a limited ability to add new housing inventory. So what has caused the difference? A main driver is income growth, according to Director Samuel So. 'San Francisco's growth has roughly doubled that of New York's in recent years,' said So. After hitting their respective bottoms with regard to home prices, income has increased 21% in San Francisco while only growing 11% in New York.

Among the other notable differences is post-crisis distressed inventory. In San Francisco, for instance, inventory increased rapidly from early 2007 until early 2010 before resolving relatively quickly and returning to pre-crisis levels by 2014. In contrast, New York's distressed inventory remains very high (roughly three times higher than the level in 2007). What's more, high inventory is likely to weigh heavily on New York's housing market until well into 2018.A primary driver of this contrast is foreclosure laws. 'In California, foreclosure sales can be initiated without having to file a lawsuit or go to court, actions which are required in New York,' said So.

Fitch's 'U.S. Sustainable Home Price Report - Fourth Quarter-2015' is available at 'www.fitchratings.com' or by clicking the above link.

Additional information is available at 'www.fitchratings.com'.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160512006181/en/

Fitch Ratings
Samuel So
Director
+1-212-908-0696
Fitch Ratings, Inc., 33 Whitehall Street, New York, NY, 10004
or
Marc Gilbert
Associate Analyst
+1-646-582-4810
or
Grant Bailey
Managing Director
+1-212-908-0544
or
Media Relations:
Sandro Scenga, +1 212-908-0278
[email protected]

Source: Fitch Ratings

You May Also Be Interested In

• Orchestra Life Sciences Appoints Charles Conroy as Chief Operating Officer
• KOCCA to Showcase 13 Korean Game Companies at ‘Gamescom 2026’ with PC, Mobile, and VR Lineups
• In HelloNation, Chiropractic Care Expert Andrew Yakubik, D.C., Explains Sciatic Nerve Compression and Lower Back Pain Treatment