There will be no bottom to the financial crisis until housing prices stop dropping. Look for bold moves by the new government to stem foreclosures and get mortgage rates down-Lou
US home prices plunge record 18.0 pct in Oct
US home prices plunge record 18.0 pct in Oct NEW YORK, Dec 30 (Reuters) - Prices of U.S. single-family homes in October plunged a record 18.0 percent from a year earlier, according to the Standard & Poor's/Case-Shiller
Home Price Indices released on Tuesday that indicated a U.S. housing market in the throes of a deep recession. The composite index of 20 metropolitan areas fell 2.2 percent in October from September.
The price drops, both on a year-over-year and month-over-month basis, came in worse than expectations based on a Reuters survey of economists. S&P said its composite index of 10 metropolitan areas declined 2.1 percent in October from September for a 19.1 percent year-over-year drop, also a record.
"The bear market continues; home prices are back to their March, 2004 levels." David M. Blitzer, Chairman of the Index Committee at Standard & Poor's, said in a statement.
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But don't home prices need to drop back to truly affordable levels to undo the debt-enabled excesses of the last few years? Instead of trying to keep home prices artificially inflated, why not let them fall to where they belong, and focus instead on alleviating the suffering of those who are seriously hurt by the correction process? (That's not everyone--many people bought with no money down and walked away with nothing damaged except their credit rating.)
ReplyDeleteYour right but the powers that be will not let any market take care of itself. Interventions are happening in many markets, stock,bond,gold,and soon real estate. Capitalism is being destroyed before our very eyes.
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