Home Prices Plunge Record 19.1 Percent
UPDATED at 11:28 a.m. with data from individual cities:
Home prices across the nation plunged a record 19.1 percent in the first three months of this year compared with the same period last year, according to the S&P/Case-Shiller National Home Price Index.
In Washington, prices were down 18.4 percent in March compared to March 2008.
This is bad news for hopes of a recovery. Even though stocks are showing a rebound -- more than a 25 percent gain since their early-March lows -- the nation's housing market continues to founder and in fact worsen. The index dropped 18.2 percent last quarter.
Despite low mortgage rates and dropping prices, home values continue to plummet thanks to an excess of inventory. The United States has a more than 11-month inventory, or supply, of unsold housing. Until that burns down to a two- or three-month supply, the housing market will see no recovery and prices will continue to drop.
Home prices in the nation's largest 20 cities dropped a record 18.7 percent compared with the first quarter of 2008.
-- Phoenix and Las Vegas, two of the most overbuilt cities in recent years, showed declines in home prices of more than 30 percent. So did San Francisco, which may be a sign of the loss of affluence. It's very difficult to build new housing in San Francisco, owing to a height restriction, the fact that it's on a peninsula and has so many historic properties, so it's not a problem of excess inventory in SFO.
-- Charlotte and Denver had the best performance among the 20 cities surveyed tracking prices from February to March of this year. Home prices in each city edged up 1 percent over that one-month period.
May 26, 2009; 11:28 AM ET
Categories: The Ticker | Tags: Case-Shiller, home prices
Save & Share: Previous: Consumer Confidence Soars in May, Markets Surge
Next: GM Inches Closer To Bankruptcy -- Or Complete Govt. Bailout
Posted by: cavatellie | May 26, 2009 12:06 PM | Report abuse
Posted by: cavatellie | May 26, 2009 12:26 PM | Report abuse
The comments to this entry are closed.