Here's an interesting report from NPR telling the story of an employee of Freddie Mac who manages an online calculator that has (intentionally or unintentionally) been telling web users that home values will only go up!

Read more from NPR:  Housing Guy Apologizes For Housing Bubble

It is interesting --- I do wish home values would only go up --- and during most years values do increase.  The last few years, however, have not held that promised increase.

That said, it depends on the time horizon that you consider.  First, the year to year bad news -- home values decreased for 4 out of the past 10 years.  That is to say that the first six years of the decade showed an increase ('01, '02, '03, '04, '05, '06) but the most recent four years have shown a decrease ('07, '08, '09, '10).

But here's an interesting cumulative look at the value of a $200,000 home purchased in 2000:

• 2001: 9% increase to $218,000 (9% cumulative increase)
• 2002: 2% increase to $222,360 (11% cumulative increase)
• 2003: 8% increase to $240,149 (20% cumulative increase)
• 2004: 16% increase to $278,573 (39% cumulative increase)
• 2005: 24% increase to $345,430 (73% cumulative increase)
• 2006: 8% increase to $373,064 (87% cumulative increase)
• 2007: 1% decrease to $369,333 (85% cumulative increase)
• 2008: 4% decrease to $354,560 (77% cumulative increase)
• 2009: 5% decrease to $336,832 (68% cumulative increase)
  
• 2010: 3% decrease to $326,727 (63% cumulative increase)

So....the premise of the title of this blog post was certainly wrong.  Home values can certainly decline over the short term, and perhaps over the long term?  Thus far, home prices are still quite solid over the 10 year horizon --- showing a 63% increase.  That said, 2006 through 2016 home values might tell a different story.