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Slide Show | December 2009

10 Cities Where Home Values Have Plummeted Most

Shawn Wilson

Every homeowner knows first hand the carnage in home values during the Great Recession. Here are the 10 cities where residential properties have fared the worst since the housing market's peak in mid 2006. These metro markets continue to suffer from foreclosures and high unemployment. Bright spots? In some of the cities in California, the median home price rose over the past year, driven up largely by first-time buyers seeking the now-expired home buyer’s tax credit and investors. But those gains may not last as the housing market bounces along the bottom.

Percentage of change in home price since the peak reflects the period from July 1, 2006 to June 30, 2010
One-year percentage of change in home price reflects the period from July 1, 2009 to June 30, 2010
One-year forecast change in home price ends June 30, 2011
Unemployment rate is as of September 2010
Foreclosure rate is as of the third quarter of 2010

Sources: Fiserv Case-Shiller, Federal Housing Finance Agency, National Association of Realtors, Moody’s Economy.com, Bureau of Labor Statistics, RealtyTrac

By Pat Esswein
Produced by Amy Pollak
(November 2010)

10 Cities Where Home Values Have Plummeted Most

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10 Cities Where Home Values Have Plummeted Most

1. Merced, Calif.

% change in price since peak: - 67.7%
One-year % change in home price: + 9.3%
Median home price: $120,000
Median family income: $47,400
Unemployment Rate: 16.6%
Foreclosure rate: 1 in every 40 households
Forecast change in home price over one year: -12.2%
Bay Area investors flooded the agricultural Central Valley, buying up some of the Golden State's cheapest housing, as the bubble built. Then they bailed out when it popped. Merced may sit in a seismically stable region, but it has been rocked by foreclosures, with the fifth highest rate in the U.S.

1. Merced, Calif.

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10 Cities Where Home Values Have Plummeted Most

2. Modesto, Calif.

% change in price since peak: - 61.5%
One-year % change in home price: + 5.4%
Median home price: $150,000
Median family income: $58,500
Unemployment rate: 16.2%
Foreclosure rate: 1 in every 36 households
Forecast change in home price over one year: 8.8%
The birthplace of filmmaker George Lucas and the inspiration for his movie “American Graffiti,” Modesto also fell victim to the Central Valley’s boom-bust phenomenon. It has the third highest foreclosure rate in the U.S.

2. Modesto, Calif.

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10 Cities Where Home Values Have Plummeted Most

3. Detroit-Livonia-Dearborn, Mich.

Shawn Wilson

% change in price since peak: - 61.0%
One-year % change in home price: 15.3%
Median home price: $52,000
Median family income: $52,000
Unemployment rate: 13.4%
Foreclosure rate: 1 in every 70 households
Forecast change in home price over one year: + 6.2%
Detroit got walloped with a one-two punch--the bursting of the subprime credit bubble and the recession. The median home price in Detroit is now the nation’s lowest (the U.S. median home price was $177,000) in a region that is the nation’s most affordable—great if you can get a job.

3. Detroit-Livonia-Dearborn, Mich.

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10 Cities Where Home Values Have Plummeted Most

4. Salinas, Calif.

Naotake Muray

% change in price since peak: - 59.4%
One-year % change in home price: + 12.3%
Median home price: $247,000
Median family income: $60,900
Unemployment rate: 10.5%
Foreclosure rate: 1 in every 80 households
Forecast change in home price over one year: + 14.1%
Bay Area investors also moved south into Salinas, driving up home prices beyond the means of local buyers. Result: The salad days are over for the city known as the “Salad Bowl of America” (80% of the lettuce grown in the U.S. is grown in the Salinas Valley).

4. Salinas, Calif.

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10 Cities Where Home Values Have Plummeted Most

5. Stockton, Calif.

Gene Wright

% change in price since peak: - 58.9%
One-year % change in home price: + 8.8%
Median home price: $185,000
Median family income: $61,800
Unemployment rate: 16.6%
Foreclosure rate: 1 in every 39 households
Forecast change in home price over one year: + 10.9%
Stockton, due east of San Francisco, is an inland port for the Central Valley (on the Stockton Deepwater Ship Channel). It suffers from the fourth highest foreclosure rate in the U.S., as well as high unemployment and crime.

5. Stockton, Calif.

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10 Cities Where Home Values Have Plummeted Most

6. Cape Coral-Fort Myers, Fla.

% change in price since peak: - 58.8%
One-year % change in home price: + 5.3%
Median home price: $100,000
Median family income: $59,600
Unemployment rate: 13.5%
Foreclosure rate: 1 in every 35 households
Forecast change in home price over one year: + 13.4%
This longtime haven for Midwestern snowbirds lies between Sarasota and Naples on the Gulf Coast. Cape Coral was developed in the 1950s with more than 400 miles of canals to provide affordable waterfront access. Now it has the highest foreclosure rate in Florida and the second highest in the U.S.

6. Cape Coral-Fort Myers, Fla.

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10 Cities Where Home Values Have Plummeted Most

7. Las Vegas-Paradise, Nev.

Mike Russell

% change in price since peak: - 56.7%
One-year % change in home price: - 4.7%
Median home price: $153,000
Median family income: $61,500
Unemployment rate: 15%
Foreclosure rate: 1 in every 25 households
Forecast change in home price over one year: + 16.0%
Las Vegas has lost big, hit by the housing boom and bust, as well as loss of business as recession-crimped tourists stayed home and worldwide gaming lured high-rollers overseas. High-rise condos took root during the boom. Since mid 2006, the median price of a condo in Las Vegas has fallen by 69%. Las Vegas has the highest rate of foreclosure in the nation, more than five times the national average.

7. Las Vegas-Paradise, Nev.

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10 Cities Where Home Values Have Plummeted Most

8. Vallejo-Fairfield, Calif.

Vallejo Convention and Visitors Bureau

% change in price since peak: - 56.0%
One-year % change in home price: +3.5%
Median home price: $228,000
Median family income: $77,800
Unemployment rate: 12.1%
Foreclosure rate: 1 in every 45 households
Forecast change in home price over one year: + 10.0%
On the northeast corner of San Francisco Bay, Vallejo attracted San Franciscans looking for affordable housing and historic homes made accessible by the local ferry. In 2008 the city faced insolvency as a result of declining revenues from property taxes, residential development, home, and retail sales.

8. Vallejo-Fairfield, Calif.

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10 Cities Where Home Values Have Plummeted Most

9. Bakersfield-Delano, Calif.

Nick Chapman

% change in price since peak: - 54.0%
One-year % change in home price: +4.9%
Median home price: $136,000
Median family income: $47,900
Unemployment rate: 15.1%
Foreclosure rate: 1 in every 44 households
Forecast change in home price over one year: +9.6%
Located in the southern end of the Central Valley, about an hour and a half north of Los Angeles, Bakersfield has suffered greatly during the recession, along with other valley cities. It relies heavily on agriculture and oil-production for jobs.

9. Bakersfield-Delano, Calif.

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10 Cities Where Home Values Have Plummeted Most

10. Port St. Lucie, Fla.

% change in price since peak: - 53.6%
One-year % change in home price: 0.2%
Median home price: $125,000
Median family income: $53,100
Unemployment rate: 14.5%
Foreclosure rate: 1 in every 76 households
Forecast change in home price over one year: +6.7%
Port St. Lucie is the largest city in St. Lucie County, on Florida’s southeast coast. Earlier in this decade the county was one of the nation’s fastest-growing. Post housing bust, new-home development has all but disappeared. (Permits to build new homes peaked in 2005 at 8,724 but have since fallen by 96.5%.) While housing languishes, the region is rebranding itself as the “Research Coast,” as it tries to attract bioscience and green-technology businesses.