Bespoke Investment Group has a good analysis (click here) showing that the financial markets are most pessimistic about Las Vegas home prices over the coming year, and most optimistic about San Francisco among major metro areas.

Traders in the Chicago Merc’s futures contracts based on the Standard & Poor’s/Case-Shiller House Price Indexes are predicting that prices in Las Vegas will fall 5.6% between March 2007 and May 2008. The predicted price decline in San Francisco is 3%. Actually, that’s not a huge gap in expectations. And you wouldn’t expect a big gap, would you? After all, if everyone thought the price in Las Vegas would be much lower a year from now, they wouldn’t wait for year to get out—they’d sell now.

Bespoke Investment Group also looks backwards at the annual change in housing prices by market. Interestingly, no two cities look exactly alike. Phoenix stands out because it was extremely calm for years, with very modest price increases. It had an enormous inflation in 2005 and 2006, and now annual price increases are suddenly back to around zero. Charlotte is another odd one: It missed the craziness of the past couple years, but prices went up steadily and are actually rising faster than ever now.

Thanks to Seeking Alpha for highlighting Bespoke’s work.

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