As home prices started to boom in the early 2000s, housing speculators doubled down on fast-growing Sun Belt markets like Phoenix, Las Vegas, and Miami. Those speculators, who were often house flippers, assumed high-population Sun Belt markets would provide the best return at the lowest risk. Of course, they were famously wrong, as those booms turned out to be some of the biggest housing bubbles, which ultimately burst and helped spur the financial crisis.
The '00s Sunbelt housing crash had one, relatively speaking, exception: The Lone Star State. Peak-to-trough, home prices in markets like Austin and Dallas only fell 8.5% and 10.5%, respectively, while house prices tracked by the Zillow Home Value Index (ZHVI) fell 63.9% in Las Vegas, 56.4% in Phoenix, and 52.2% in Miami between their peaks around 2007 and bottoms around 2012.
