Historic Downturns in Housing Prices

Downturns in housing prices are not new. The Federal Housing Finance Agency (FHFA) has issued a report , A Brief Examination of Previous House Price Declines. which reviews previous downtowns. This report lists the duration of downturns by metropolitan area.  The primary observations are as follows.

First, house price downturns have tended to be long. The median time required to return to prior peak prices was 10½ to 20
years. Second, it tends to take longer for prices to rise from the trough to their former peak than it takes prices to decline from peak to trough. While the difference is small for Census Divisions and states, FHFA’s Metropolitan Statistical Area and Division (MSA) indexes suggest that the time from peak to trough tends to be about 3¾ years, whereas the median recovery period (from trough to prior peak) was 6⅔ years.