Tracking California Luxury Home Values

First Republic Bank produces the Prestige Home Index each quarter.

They report California luxury home prices declined in the third quarter of 2008 from a year ago.

1. Los Angeles area values fell 1.9% from the second quarter of 2008 and 4.2% from the third quarter of 2007. The average luxury home in Los Angeles is now $2.33 million.
2. San Diego area values dropped 2.1% from the second quarter of 2008 and 7.5% from the third quarter of 2007. The average luxury home in San Diego is now $1.98 million.
3. San Francisco Bay Area values declined 0.7% from the second quarter of 2008 and 3.0% from the third quarter of 2007. The average luxury home in San Francisco is now $2.99 million.

It seems that the indexes all tell different stories, so its hard to come up with a definitive understanding of what is really going on. The Case-Schiller index, which is looking at homes sold in all price categories, show us that San Francisco homes have decline by 31% year over year.

If these idexes can be trusted, its clear that a high end home, by far, has been an outstanding investment, losing only 3% of its value in roughly the same time period. Clearly, people willing and able to buy a 3 million dollar home are not concerned about bank solvency or interest rates. Nice place to be....

Thanks for Reading
Howard Bell
www.yourpropertypath.com
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