Real Estate Markets with the Biggest Drops Since Market Peak

Unless you’ve been living in a cave or refuse to engage in real estate headlines of late, it’s common knowledge that many local real estate markets are down around the country. So, I thought I’d dig into the data of our Q1 Home Value Reports to find which real estate markets suffered the biggest percentage drop since the peak of the market for the past 10 years.

I don’t think it’s any real surprise that the 15 markets with the largest drop from their peak are from California and Florida, foreclosure hot spots that have been well-documented in the media. Merced was off 46.1%, Stockton 40.7%, and Punta Gorda rounded out the top three at 39.5%. Coming in at number 16 with a 29.6% drop is Las Vegas, which experienced the largest drop outside the devastated Florida and California markets.

Next, I went to look at the peak values for the past 10 years and precisely when the peak occurred. According to our Zindex home value index, the peak of the United States housing market in the past 10 years occurred in Q3 of 2006 in which the Zindex was $235,000. Currently, the U.S. Zindex is $213,000, which is down 9.2% from peak value.

Onto local markets. The only market with a peak of less than $100,000 was the Muskegon-Norton Shores MI metropolitan statistical area (MSA), which came in at $99,000 in Q3 of 2004. However, there are currently six markets with a Zindex of less than $100,000. Flint, MI, comes in at the bottom of the barrel with a Zindex of $77,000. As for the highest peak Zindex? Coming in at $759,000, that honor is held by the Santa Cruz-Watsonville CA MSA.

Below is data on the all 160 MSAs in terms of largest drops since the peak of the market: