The Story of the U.S. Housing Boom and Bust

The Story of the U.S. Housing Boom and Bust

All 20 main U.S. cities experienced spectacular house price rises during the boom (1996-Q1 2006). Los Angeles registered the biggest house price rise of 265.5%, followed by San Diego (247.7%), San Francisco (226.6%), and Miami (213.1%).

Then in Q2 2006, house prices started to fall.

The S&P home price index plunged 33.8% from Q2 2006 to Q4 2011. Phoenix registered the biggest drop (-55.2%) among the twenty largest metro areas, followed by Miami (-50.5%), Detroit (-42.8%), San Francisco (-41%), Los Angeles (-40.7%), and San Diego (-39.7%).

Starting the second half of 2012, the U.S. housing market started to recover, led by Phoenix. All the 20 largest cities in the U.S., except New York, saw house price rises in 2012 from a year earlier.

In 2013, Las Vegas house prices surged 25.5%, followed by San Francisco (22.6%) and Los Angeles (20.3%).

House prices continue to rise in the following years, albeit at a much slower pace. The S&P home price index rose by 4.4% in 2014 and by 5.5% in 2015.