What I learned from The Drudge Report today

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Today’s earlier post on the dramatic median price decline in California was linked by The Drudge Report, and many of you commented on how the Drudge audience changed the tenor of the comments section. Yes, it’s a different crowd.

But I learned something from it: I received quite a few e-mails complaining that the post lacked historical context, because it failed to mention, or quantify, the huge run-ups in prices in California that preceded the decline. At first, I reflexively dismissed that criticism -- all of us are well aware of where we stand in the cycle. Then I thought about it, and it struck me that a number of regular readers have made the same complaint recently.

You’re right -- this blog needs a bit of a history lesson. I’ll start with a modest one tonight, and, with your guidance, keep at it until we’ve put together a workable history of the bubble.

Tonight, the big picture. In June of 2000, DataQuick reported that median sales prices in Los Angeles had reached $203,000 -- finally reaching the levels of the previous peak, in May of 1991. Though I think a history of the bubble probably goes back to 1997 or so, when prices started rising from the bottom of the previous cycle, June 2000 will do for tonight:

Month/Year Median home price in LA Y/Y % Change
June 2000 $203,000 2.5%
June 2001 $228,000 12.3%
June 2002 $269,000 18.0%
June 2003 $313,000 16.4%
June 2004 $414,000 32.4%
June 2005 $475,000 14.7%
June 2006 $517,000 8.8%
June 2007 $545,000 4.8%
Feb. 2008 $460,000 -12.9%

Thoughts? Comments? Aspects of the Bubble History you’d like to see? I’ll try to post more tomorrow.
Email story tips to peter.viles@latimes.com.
Photo Credit: AFP