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March 25, 2008
US Home Prices fall 11.4% in January
I can remember writing last fall that many economists felt that the housing market would begin to rebound after the first of the year.
Judging by this report, we still have a long way to go:
The decline reported Tuesday in the Standard & Poor's/Case-Shiller index means prices have been growing more slowly or dropping for 19 consecutive months. Cities with the worst drop in home prices were Las Vegas and Miami - each reporting an astonishing 19.3% drop.
The index tracks the prices of single-family homes in 10 major metropolitan areas in the U.S. The broader 20-city composite index also fell, dropping 10.7 percent in January from a year ago. That makes it the first time both indexes dropped by double-digit percentages.
"Home prices continue to fall, decelerate and reach record lows across the nation," said David Blitzer, index committee chairman at S&P. "No markets seem to be completely immune from the housing crisis."
Blitzer said all 20 cities S&P tracks have seen dropping prices for five consecutive months, when compared to the prior month. What's more, the declines are growing in severity, with 13 of the 20 cities reporting their biggest single monthly decline in January.
There are still some analysts that are hopeful that the worst is behind us and that better days are ahead for the housing market. However, a general downturn in the economy plus a huge inventory of unsold homes makes that prospect more and more unlikely.
And the truly frightening prospect is that no one can guess when the downturn will bottom out.