Case-Shiller Home Price Index Points to Housing Double-Dip
Case-Shiller Home Price Index Points to Housing
Double-Dip
Home prices in the largest metro areas of the U.S. have fallen to near decade lows, as accumulating foreclosures, an oversupply of homes listed for sale, and strict credit standards have conspired to limit demand. According to the Standard & Poor's / Case-Shiller home price index, which tracks values in the nation's 20-largest cities, prices fell in 18 of those areas from February to March. Additionally, prices in 12 of those markets have fallen to their lowest levels since the housing crisis began.
The report, released Tuesday afternoon, is the eighth in a row to show declining home values in the U.S. Prices have fallen further since the housing bubble burst in 2006 than at any time since such records have been kept, including the period after the Great Depression. According to housing analysts, the market took a staggering 19 years to recover after the Depression, the only financial downturn in the nation's history worse than the recent recession which we are still trying to recover from.
Last summer, prices actually rose slightly as the government's now-expired tax credits for homebuyers provided an incentive for on-the-fence buyers to purchase a home. But prices have fallen significantly since then, marking a so-called "double-dip" recession, at least in terms of housing values. When inflation-adjustments are calculated, prices are now at their lowest levels since 1999.
Most economists believe that prices will drop another 5 percent or more by the end of the year, and will continue to fall until the oversupply of discounted foreclosures comes down. Another major factor in the instability in the housing market is the delays banks are having in processing foreclosures. Some banks stopped foreclosing on homes altogether, and all have slowed their pace amid probes into how they processed them over the last two years.
Home prices in the largest metro areas of the U.S. have fallen to near decade lows, as accumulating foreclosures, an oversupply of homes listed for sale, and strict credit standards have conspired to limit demand. According to the Standard & Poor's / Case-Shiller home price index, which tracks values in the nation's 20-largest cities, prices fell in 18 of those areas from February to March. Additionally, prices in 12 of those markets have fallen to their lowest levels since the housing crisis began.
The report, released Tuesday afternoon, is the eighth in a row to show declining home values in the U.S. Prices have fallen further since the housing bubble burst in 2006 than at any time since such records have been kept, including the period after the Great Depression. According to housing analysts, the market took a staggering 19 years to recover after the Depression, the only financial downturn in the nation's history worse than the recent recession which we are still trying to recover from.
Last summer, prices actually rose slightly as the government's now-expired tax credits for homebuyers provided an incentive for on-the-fence buyers to purchase a home. But prices have fallen significantly since then, marking a so-called "double-dip" recession, at least in terms of housing values. When inflation-adjustments are calculated, prices are now at their lowest levels since 1999.
Most economists believe that prices will drop another 5 percent or more by the end of the year, and will continue to fall until the oversupply of discounted foreclosures comes down. Another major factor in the instability in the housing market is the delays banks are having in processing foreclosures. Some banks stopped foreclosing on homes altogether, and all have slowed their pace amid probes into how they processed them over the last two years.
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