The Case-Shiller index for house prices shows a marked difference between the 10 cities with the highest returns between 2002 and 2005, and the 10 cities with the lowest returns over that period. (Index values as released at 24 Feb 09)
It's obvious that in the "non-boom" cities the price declines have been much more muted than in the boom cities. What is worrying is that the recession has now hit the prices of cities that didn't boom. Declines in these prices is now as fast as for the boom cities.
But the behaviour of the non-boom cities was also more muted back in the early 1990s. We definitely have a heterogenous group of cities.
Copies of spreadsheet available for those interested.
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