L.A. home prices dropped 13.7% in ’07

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Home prices in Los Angeles lost 13.7% in 2007, and were declining at an accelerating pace at the end of the year, according to Standard & Poor’s Case-Shiller home price index. The report also points to a regional housing bust -- the American cities with the nation’s most severe price declines in November and December of 2007 were concentrated in the West and Southwest.

From LATimes.com: ‘The Los Angeles-area home price index, which includes Orange County, is now 15% below its peak, which Case-Shiller says occurred in September 2006. Various economists have predicted that Los Angeles-area home prices will decline 20% to 30% from their peak level.’

Headlines, highlights, lowlights:

--The Case-Shiller index for Los Angeles fell 3.1% from November to December, and declined 13.7% over the course of the year.

--As measured by Case-Shiller, Los Angeles still has the nation’s largest housing bubble. For those who don’t believe there was a housing bubble, you would say that Los Angeles is holding on to more price appreciation than any other American housing market.

--The cities with the largest price drops from November 2007 to December 2007 are concentrated in the West, suggesting the possibility of a regional recession similar to the one that followed the S&L bust:

1) Phoenix (-3.5%)
2) San Diego (-3.4%)
3) San Francisco (-3.25%)
4) Los Angeles (-3.1%)
5) Las Vegas (-2.9%)

The Case-Shiller index is considered among the most accurate measures of home values over time. Unlike other sales reports, which rely on overall market activity, the Case-Shiller index is built out of ‘matched pairs’ -- instances in which the same house sold twice over a period of time.

Thoughs? Comments? E-mail story tips to peter.viles@latimes.com.