Table 1

The national statistics on housing remain most impressive. Some 1.85 million housing units were started in 2003, the highest total since 1978. Monthly permits for new units continue to be issued at a rate of around 2 million per year, showing that the home construction pipeline remains strong. The value of private residential construction in second quarter 2004 was 15 percent higher than a year ago. Existing home sales have continued to climb to new records, reaching an annual rate of almost 6.8 million units in second quarter 2004. A record 69 percent of U.S. households owned their homes as of second quarter 2004, up from 64 percent a decade ago.

Market conditions have been unusually conducive to strong growth in housing activity. Interest rates for long-term fixed-rate mortgages fell to their lowest levels in more than a generation in second quarter 2003, prompting strong demand for mortgage credit from new homebuyers and existing homeowners wishing to refinance.⁴ Since mid-2003, increases in mortgage rates have significantly damped mortgage refinancing activity. But the continued availability of long-term fixed-rate mortgages of around 6 percent, along with increasing reliance on lower-cost adjustable rate mortgages, has helped keep home sales and home construction at high levels.

Analysts continue to point out that home price increases have outpaced income growth for some time, a situation that cannot persist indefinitely (see Chart 1). Another source of concern is a rising rental vacancy rate for residential properties, which now exceeds 10 percent of year-round rental housing units for the first time on record, led by increases in the Midwest and the South.⁵

Chart 1
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However, as has been said about politics, residential real estate trends truly are local. Analyses of metro-area price increases versus fundamental factors continue to point to a group of cities on the west coast, the east coast, and in the southeast where prices appear to have diverged most noticeably from underlying fundamentals.⁶ Still, these analyses cannot predict when or how current price discrepancies might be resolved. Of more use in this regard may be to assemble anecdotal summaries of local trends that may call attention to turning points before they become apparent in the data. What follows is commentary by analysts in each of the Federal Deposit Insurance Corporation's six regional offices and two area offices describing the most recent developments in their parts of the nation.

Atlanta Region: Southeast Housing Markets Are Still Going Strong
Record levels of home sales continue across the Atlanta Region, with home price appreciation remaining strong in many metropolitan areas. More than 20 markets in the Region—all of which were in Florida or Virginia—reported home price appreciation in the double digits over the past year. However, nearly two-thirds of the Region's metropolitan markets saw price gains below the national average, and, primarily in Alabama and the Carolinas, increases failed to keep pace with inflation.

Continued price gains have contributed to a decrease in affordability in most metropolitan areas, according to Economy.com. Over the past year ending second quarter 2004, affordability declined in all but five Atlanta Region metropolitan areas. Moreover, in several Florida markets as well as Northern Virginia, affordability has fallen by more than 10 percent. Anecdotal reports suggest that some speculative activity in housing is occurring in some markets, particularly in South Florida. For example, a significant number of condominium units are being delivered in the areas of South Florida, the Florida Panhandle, and the Gulf Coast of Alabama. These additions to supply are coming from two sources: new development and apartment conversions. Further, there is an active precompletion market, as some condominiums are being sold multiple times (or "flipped") before delivery. In some cases, interim buyers are leveraging their purchases by the use of standby letters of credit.⁷

Changes in underwriting practices may be contributing to ongoing rapid price appreciation in many markets. Innovative structures, such as downpayment assistance programs, interest-only mortgages, and piggyback loans, may allow buyers to purchase more expensive homes than they would otherwise be able to afford.⁸ Further, credit impairment, as reflected by low FICO scores or a history of loan defaults, does not appear to be a major impediment for prospective mortgage borrowers.⁹ For example, one recent news article reported that a homebuyer was able to secure 100 percent purchase-money financing despite having experienced a foreclosure just a year earlier.¹⁰

Other factors that could disrupt housing markets, particularly in Florida, include heightened storm activity and construction input shortages. Through September 2004, four major hurricanes made landfall in the Southeast, and their short- and long-term impacts are not yet fully known. Going forward, some locations could see reduced demand for housing if storm fears persist or if insurance costs become prohibitive. In addition, affordability could worsen because of higher costs associated with construction material and labor shortages. Hurricane rebuilding efforts likely will intensify the pre-existing shortfall in building inputs.

Scott Hughes, Regional Economist
Jack Phelps, Regional Manager

New York Region: Mid-Atlantic Housing Markets Still Sizzle, but Some Markets May Be Losing Steam
The strong home price appreciation observed across much of the nation is also evident in a number of Mid-Atlantic metropolitan areas. Seven Mid-Atlantic metropolitan statistical areas (MSAs) ranked among the top 50 MSAs in the nation with regard to home price appreciation: Albany, New York; Washington, D.C.; Baltimore and Hagerstown, Maryland; and Atlantic City, Jersey City, and Monmouth-Ocean counties, New Jersey. Moreover, half of the Mid-Atlantic's 40 metro areas tracked by OFHEO had appreciation rates in excess of the national average of 9.4 percent. Homes are appreciating at high rates in suburban areas of larger cities such as Philadelphia, Washington, D.C., and New York City. In fact, home price appreciation in and around New York City and Washington, D.C., has been so strong for more than the last five years that it is beginning to rival and even exceed the large price increases of the 1980s.

But after several years of substantial home price appreciation, there are indications that residential real estate markets in Mid-Atlantic states may be starting to cool off. In New Jersey, brokers report that while the market is still strong, multiple offers are not as commonplace as they were a few months ago, and high-priced homes are sitting on the market longer. In Baltimore, there are indications that double-digit price increases were in part responsible for a 20 percent increase in new listings, suggesting that high prices were prompting more homeowners to put their homes on the market. However, reports also suggest that houses in Baltimore, as in other parts of the Mid-Atlantic, are staying on the market longer. Absent dramatic declines in mortgage rates, the increase of housing inventories, combined with longer listing periods, may portend a slackening pace of home price appreciation.

The recent surge in home prices is attributable in part to historically low mortgage rates, which have boosted affordability and allowed households to finance increasingly expensive homes. Affordability has not improved, however, in many Mid-Atlantic housing markets, because low mortgage rates have been more than offset by price increases. According to Economy.com, areas in and around New York City have become increasingly less affordable relative to the nation, closely followed by areas around Baltimore and Washington, D.C.¹¹ Compared with many other areas in the nation, developable land is scarcer-and therefore more expensive-in those metropolitan areas; and with greater population density, demand for housing generally has exceeded supply.

A July 2004 study by the Center for Housing Policy reported that incomes were lagging substantially behind housing prices in many parts of the nation.¹² The report concluded that workers in formerly middle-class occupations such as nursing, teaching, and law enforcement could no longer afford a middle-class home in many of the nation's markets. This trend appears to apply to several Mid-Atlantic housing markets. For example, brokers and real estate analysts report that many public servants cannot afford to live in Ann Arundel County, Maryland, and must commute an hour to an hour and a half from less expensive homes on Maryland's eastern shore. In Annapolis, Maryland, housing affordability has become such an issue for first-time homebuyers that the city council voted to impose an "affordability" requirement on developers that requires them to construct low-cost units in any new subdivision with more than 30 homes. Another factor that has reduced affordability is the rapid increase in property taxes that has accompanied rising market values. Several years of rising assessments on residential property are starting to take a bite out of cash flow for many homeowners.

However, not every housing market in the Mid-Atlantic is soaring. Of 128 U.S. metropolitan areas studied by the National Association of Realtors (NAR), Syracuse, New York, showed the second lowest median price ($94,700) in second quarter 2004.¹³ According to the NAR, the year-over-year rate of home price appreciation in Syracuse declined from 15.6 percent in third quarter 2003 to just 2 percent in second quarter 2004. However, despite slowing price appreciation, local real estate agents report that market conditions in Syracuse continue to be strong, because the level of home prices remains affordable, interest rates remain relatively low, and local economic conditions have improved. Home price appreciation also remains modest in other parts of upstate New York and in western Pennsylvania. As a result, residents in these areas have built up less home equity than in other areas and may have had less opportunity to convert home equity into cash.

Norman Gertner, Regional Economist

Boston Area: New England Home Prices Continue Exceptional Growth for at Least the Time Being
This year is almost certain to be another strong year for housing in New England following several years of exceptional performance with sustained, sizeable price increases. Prices of conventionally financed houses in New England are likely to average more than 10 percent higher this year relative to last year.¹⁴ While a single year of double-digit growth is impressive in its own right, it is even more remarkable that prices have risen on average almost 10 percent per year since 1998 (see Chart 2). This six-year performance ranks second only to the 1980s housing boom in the modern history of the Region.

Chart 2
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Partly in response to ongoing increases in house prices, new housing construction has been brisk. New housing permits in the Region were issued at an annualized rate of over 50,000 during the first seven months of 2004. This is the fastest pace of issuance since 1988, a year that, coincidentally, marked the beginning of the end of the last New England housing boom. This year and 2003 also mark the return of multifamily construction as a major contributor to the supply of new housing, accounting for almost one-quarter of total new construction.¹⁵ This new increase in supply will tend to reduce upward price pressures in the housing market.

While home price increases have been distributed fairly evenly across the Region, new construction has tended to be concentrated in the relatively less expensive and less densely populated states of northern New England (see Chart 3). By contrast, southern New England has experienced little, if any, growth in the rate of new residential construction.

Chart 3
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Housing demand in New England remained strong even as the national and regional economies entered a recession in 2001 and recovered slowly thereafter. The recession and weakness in the equity markets combined to reduce growth in total personal incomes in New England from slightly more than 10 percent per annum in early 2000 to no growth only two years later. Still, during this period of economic weakness, sales of existing single-family units dipped only in New Hampshire and in Massachusetts, which is the state most affected by the recession. Since then, new home sales generally have increased within the Region, rising to near-record levels in each of the six New England states by mid-2004.

Frederick S. Breimyer, Regional Economist

Chicago Region: Housing Markets Appear Healthy, and Immigrants Play a Role
High levels of single-family home construction and resales in the Region reflect that housing demand remained strong through mid-2004.¹⁶ The pace of home price appreciation varied among the Region's 59 MSAs but was generally moderate.¹⁷

Among the Region's largest MSAs, appreciation was strongest in Chicago, where price gains averaged 6.7 percent a year between the second quarters of 2002 and 2004. Contrasting home price trends in the Region's most industrialized states, Indiana and Wisconsin, partly may reflect the fact that manufacturing employment in Wisconsin rose by 0.9 percent in the year ending second quarter 2004 and fell by 0.6 percent in Indiana. Eight MSAs in the Region, mostly in Indiana, experienced less than 3 percent annual appreciation in the past two years. In contrast, seven of 13 MSAs with annual appreciation between 5.0 percent and 9.2 percent were in Wisconsin. In other MSAs scattered throughout the Region, home price appreciation averaged between 3.0 percent and 3.9 percent in 23 of them and between 4 percent and 5 percent in the remaining 15.

The Chicago MSA's large and growing immigrant population is helping spur local housing demand. Chicago is one of nation's major immigrant destinations, and most of the estimated 40,000 immigrants to Illinois each year settle in Chicago or its suburbs. This growing immigrant population provides new customer opportunities for residential developers and lenders.¹⁸ In fact, immigrants recently have purchased up to 20 percent of newly constructed homes in some Chicago suburbs, about four times more than ten years ago.¹⁹ Some developers, in turn, increasingly are tailoring their construction, design, and marketing to immigrant and ethnic groups, and some banks are expanding their efforts to serve this market.

Although some immigrants are considered to be undocumented, they may account for as much as $10 billion of potential mortgage lending in the Chicago area.²⁰ The untapped market is large and potentially profitable for lenders, who reportedly charge an additional 25 basis points to 100 basis points of interest on mortgages to undocumented persons, with the markup reflecting the size of the down payment and the lack of a secondary market for such loans.²¹

Serving this customer pool, however, may require banks to modify some long-standing practices. Some lenders have changed their policies to accept consular identification cards rather than Social Security cards as identification from depositors and loan applicants. Banks making mortgage loans to undocumented immigrants forfeit the ability to the sell mortgages in the secondary market to Fannie Mae and Freddie Mac, because such loans fail to meet their specifications.

To the extent that banks and thrifts follow prudent risk management, operational, and underwriting standards, serving immigrants may provide a profitable channel for deposit, loan, and fee growth among insured institutions in the Chicago market and in other areas with large immigrant populations or inflows.

Joan Schneider, Regional Economist
David Van Vickle, Regional Manager

Kansas City Region: Steady Conditions Predominate
Housing markets in the Kansas City Region remain relatively stable. While home prices in metropolitan areas have increased moderately over the past couple of years, these increases are generally judged to have been in line with job growth and other economic fundamentals.

In the Kansas City metropolitan area, homes in Johnson County, Kansas, continue to have the highest average sales prices, followed closely by homes in Platte County, Missouri. Within Johnson County, Olathe continues to see particularly high levels of new home construction to meet the needs of a rapidly increasing population. Wyandotte County, Kansas, which has more moderate prices than Johnson County, experienced much higher increases in average new home prices over the past year (16.8 percent), as the new racetrack and shopping continue to draw residents. Outlying counties such as Miami County, Kansas, are seeing even higher growth in resale prices as buyers continue to move further from downtown in search of more affordable homes.

While the Minneapolis-St. Paul metropolitan area has experienced strong price increases over the past few years, at present, inventories of new and resale homes appear to be in balance, with the average home staying on the market for about five months before sale. However, according to the Minneapolis Area Association of Realtors, demand for higher-priced homes is beginning to wane, and selling times are expected to increase to over a year in the near future. While the median home price in the metropolitan area is higher than in the nation as a whole, the relative affordability of homes in this market is reflected in a local homeownership rate of more than 75 percent, compared with 69 percent nationwide.

In the St. Louis metropolitan area, current sales volume is brisk, but the pace is expected to slow over the next six months. The median home price has risen by about 5 percent during the last year, driven mostly by "move-up" sales to larger homes and by historically low interest rates. The St. Charles area has seen the greatest growth in new home construction, mainly due to lower land prices and a greater availability of building sites than in other parts of the metropolitan area.

One outlier market in the Region is Wichita, which continues to suffer job losses resulting from the struggling aircraft manufacturing industry. Existing home prices have fallen over the past year, while new home prices have increased slightly. Overall, home prices in Wichita have declined about 2 percent this year from January through August 2004.

Tight supplies of building materials are causing concerns for some builders and contractors. Recent shortages reportedly have added about 6 percent to the cost of new construction in the Region and threaten to constrain growth going forward. Delays in getting materials to job sites have reportedly increased lead times, which are the times between ordering and receiving building supplies, to three months. While such delays could hamper construction, they have not yet translated into a reduction in building permits, which remain strong in the Kansas City, St. Louis, and Minneapolis markets.

John M. Anderlik, Regional Manager
Shelly M. Yeager, Financial Analyst

Memphis Area: No Apparent Signs of Overheating in Mid-South Markets
A review of published reports and routine data series revealed no imminent signs of market-wide housing bubbles for any of the metro areas in the Mid-South, which comprises Arkansas, Louisiana, Mississippi, and Tennessee. Some factors that seem to be prominent in the national markets experiencing the most rapid price increases, such as the limited availability of building lots and cumbersome entitlement requirements, are largely absent in the Mid-South. According to data collected by OFHEO, home prices in these four states have risen 51 percent in the past ten years compared with 73 percent for the nation as a whole, and 22 percent in the past five years compared with 44 percent for the nation. Of all the major markets in the Region, New Orleans, Monroe, and Houma, Louisiana, experienced the strongest ten-year rate of home price appreciation; however, they ranked only 110th, 127th, and 128th in the nation, respectively. Housing affordability has remained fairly stable in these markets, as per capita income has grown at rates near the national average and in line with the pace of home price appreciation.

As noted in Money Magazine, "If you live in the many states where home-price gains have been more modest, the odds strongly favor more of the same. There's a much tighter relationship between home prices and incomes in Middle America than on the coasts. In California and Rhode Island, the correlation between home prices and income is ten times weaker. The main reason: There's more buildable land away from the coasts, so the balance between supply and demand rarely gets out of whack."²²

Although it does not appear likely that housing prices will drop rapidly across the Mid-South Region, some submarkets and price ranges could experience imbalances that might result in increased inventories of unsold homes, longer selling times, and possible price declines. One area that merits close monitoring is the starter-home segment, where generational lows in mortgage rates have made owning a home more attractive than renting. However, rising interest rates could raise monthly payments beyond the capacity of many potential buyers and may also raise the debt-service costs of homebuilders, limiting their ability to continue incentive programs that have been stimulating demand.

Paul Vigil, Financial Analyst

Dallas Region: Residential Real Estate Round-Up
Residential mortgage foreclosures in Texas were the 12th highest in the nation as of mid-year and do not appear poised to improve anytime soon. September mortgage foreclosures in Dallas County were 21 percent higher than a year ago, while the increase was 22 percent in Travis County and 35 percent in Bexar County. Growth in jobs and wages remain the key drivers supporting home price appreciation, and in this regard, each market has its unique set of circumstances. Employment growth is still lackluster for most metro areas. For example, the Dallas metro area experienced two recent job loss announcements. First, Delta Airlines stated that it will discontinue operations out of Dallas/Fort Worth International Airport, cutting an estimated 3,600 direct jobs in North Texas. Electronic Data Systems (EDS) also announced a downsizing of between 13 percent and 17 percent, affecting some of the 7,700 EDS jobs in the Dallas area.

The San Antonio metropolitan area currently reflects a set of contradictory trends that could begin to show up in other parts of the country as well. While metro-area foreclosure rates are among the highest on record, the issuance of residential building permits is also at record high levels. One reason these seemingly contradictory trends can take place at the same time is that the city continues to grow primarily in the north, where most of the new building is taking place, while foreclosure rates have been increasing in the slower-growing southern part of the city.

In Oklahoma, mortgage foreclosures continue to rise to the highest level in a decade, ranking sixth highest nationwide. Personal bankruptcy filings per capita in Oklahoma are also in the top quartile among the states, suggesting that many consumers have been under significant financial pressure. Oklahoma employment growth turned positive in April for the first time since late 2001 but still ranks in the bottom half of the nation.

One Southwest Dallas Region metro area that is listed on many analyst watch lists for home price-income gaps is Denver, Colorado. According to OFHEO, the Denver housing price index has increased 41 percent over the past five years, which is the fastest metro rate of growth in the four-state Southwest Region. Moreover, the Denver ratio of median home price to household income is at its highest year-end level (4.66 times) since 1980.

Jeffrey A. Ayres, Senior Financial Analyst

San Francisco Region: Analysts Are Becoming More Wary of Price Increases
Strong home price appreciation in several areas of the San Francisco Region has fueled household wealth and spending and helped to keep foreclosure and bankruptcy rates low. However, home price increases in Nevada, Hawaii, and California, which reported the three highest rates of annual home price appreciation nationwide in second quarter 2004, may not be sustainable. A respondent from the banking industry who follows the western residential market warned that at some point, the trend of increasing appreciation and decreasing affordability will have to come to an end, a sentiment echoed by several industry sources in the Region.

Nevada's rapid home price appreciation was spurred in part by robust increases in population, jobs, and new home construction costs. Speculative purchase activity may have also played a role.²³ While home prices in Nevada still remained relatively attractive when compared with several other West Coast states, a respondent in academia noted, "Recent home price appreciation has started to dry up housing affordability, and this may become an issue for Las Vegas and Nevada down the road."

Following years of sub-par home appreciation, Hawaii home prices picked up steam in 2002 and have continued to appreciate, reaching 19 percent appreciation in second quarter 2004. Recent appreciation is attributed to an improved economy, favorable interest rates, and renewed interest in home buying by both Hawaii residents and investors. Another respondent in the banking industry noted that mainland investors have driven much of the state's home price appreciation, particularly in Maui and Kauai.

In supply-constrained California, where 13 MSAs ranked in the top 20 nationally for annual price appreciation, concerns of an emerging bubble may have increased.²⁴ A market respondent defined a bubble as when you "buy not for the roof, but for the money, for speculation." The respondent also indicated that speculative home purchases may be on the rise in Southern California, although they are not evident in Northern California. In particular, Orange County's "flipping" rate, or share of homes sold after being owned less than six months, is near its historic high.

Both single-family and construction lenders could face loan growth and asset quality challenges should markets cool as a result of rising interest rates. Some insured institutions based in areas with rapidly appreciating home prices, such as Las Vegas, Honolulu, and Central and Southern California could be particularly vulnerable, because they also appear to be exposed to some combination of high single-family mortgage or construction loan concentrations, significant volumes of variable-rate mortgages, and potentially speculative purchase activity.

Shayna Olesiuk, Regional Economist
Judy Plock, Senior Financial Analyst
John A. Roberts, Regional Economist

¹ Office of Federal Housing Enterprise Oversight, "OFHEO House Price Index Shows Largest One Year Increase since 1970's: U.S. House Prices Show Annual Rise of 9.36 Percent," news release, and House Price Index report (second quarter 2004), September 1, 2004, http://www.ofheo.gov/media/pdf/2q04hpir.pdf. The analysis based year-to-year changes on second quarter 2004. OFHEO tracks home prices for 328 metropolitan areas.

² The extraction of homeowners' equity is calculated as the sum of cash proceeds plus second mortgage balances rolled into refinancing ($211 billion, according to Freddie Mac) and the net change in home equity loans outstanding ($101 billion, according to the Federal Reserve Board).

³ Cynthia Angell, "Housing Bubble Concerns and the Outlook for Mortgage Credit Quality," FDIC Outlook, Spring 2004, http://www.fdic.gov/bank/analytical/regional/ro20041q/na/infocus.html.

⁴ The Freddie Mac contract rate for 30-year fixed-rate first mortgages fell to 5.23 percent in June 2003, the lowest monthly level recorded in the 34-year history of this series.

⁵ Data from the U.S. Census Bureau. The rental vacancy rate is defined as vacant year-round units for rent divided by the sum of renter-occupied units plus vacant year-round units rented but awaiting occupancy, plus vacant year-round units for rent.

⁶ PMI Mortgage Insurance Co., Economic & Real Estate Trends, Summer 2004, http://www.pmigroup.com/lenders/media_lenders/pmi_eret04v3s.pdf; and Celia Chen, "House Price Bubble Worries," Economy.com, July 16, 2004, http://corporate.dismal.com/dismal/pro/article.asp?aid=2872.

⁷ Ryan Dezember, "The Condo Game," Mobile Register, July 6, 2004.

⁸ James R. Hagerty, "For These Mortgages, Downside Comes Later," Wall Street Journal, October 5, 2004. A piggyback financing structure includes two or more loans at origination: for example, a first mortgage in an amount equal to 80 percent of the purchase price and a second mortgage in an amount equal to 20 percent of the purchase price. This structure eliminates a monthly payment for private mortgage insurance; hence, the borrower can qualify for a higher-priced home with the same fixed budget.

⁹ Pamela Yip, "Looser Lending Blamed as Foreclosures Rise," Dallas Morning News, October 4, 2004.

¹⁰ Clint Williams, "A Hunger for Housing," Atlanta Journal-Constitution, August 28, 2004.

¹¹ Affordability refers to when median family income qualifies for an 80 percent mortgage on a median-priced existing single-family home. It is based on a 25 percent qualifying ratio for monthly housing expense to gross monthly income with a 20 percent down payment.

¹² Barbara J. Lipman, "America's Newest Working Families: Cost, Crowding and Conditions for Immigrants," Center for Housing Policy: National Housing Conference 4 (no. 3), July 2003.

¹³ National Association of Realtors, "Median Sales Price of Existing Single-Family Homes for Metropolitan Areas," table, http://www.realtor.org/Research.nsf/files/REL04Q2T.pdf/$FILE/REL04Q2T.pdf.

¹⁴ Federal Home Loan Mortgage Corporation, "Conventional Home Price Index." Prices are annualized for 2004 based on first-half results.

¹⁵ U.S. Census Bureau via Haver Analytics, "New Privately Owned Housing Units Authorized in Permit-Issuing Places," table.

¹⁶ The Chicago Region consists of Illinois, Indiana, Kentucky, Michigan, Ohio, and Wisconsin.

¹⁷ Appreciation rates are based on data from OFHEO that measure average prices of repeat sales or refinancings on the same single-family properties where the transactions involve conforming, conventional mortgages purchased or securitized by Fannie Mae or Freddie Mac.

¹⁸ See "Banks Are Still Sizing Up Opportunities in the Growing Hispanic Market" by Jeffrey A. Ayres, Stephen L. Kiser, and Adrian R. Sanchez in this issue.

¹⁹ John Handley, "Destination Chicago: Immigrants Put Their Stamp on Suburban Housing, Buying up to 20% of New-Construction Homes," Chicago Tribune, May 11, 2003.

²⁰ Steve Daniels, "No Documents? No Problem," Crain's Chicago Business, April 19, 2004.

²¹ Ibid.

²² Jon Birger, "What's Next for Real Estate: Another Hot Year for Home Prices Has Some Wondering Whether Real Estate Is Poised to Tumble," Money Magazine, March 1, 2004.

²³ "Foreclosures.com: Las Vegas Home Price Bubble Set to Deflate," Mortgage Mag, August 23, 2004, http://www.mortgagemag.com/n/408_032.htm.

²⁴ Markets reporting the fastest rates of annual price appreciation were predominantly in Southern and Central California.