More Huge Declines

Remember housing values only go up. Property is a great investment. Bubbles are for bathtubs. Until reports like this come out -

Home prices in 20 U.S. cities declined 18.2 percent in November from a year earlier, the fastest drop on record, as foreclosures climbed and sales sank.

That is from an article in Bloomberg titled November Home Prices in 20 U.S. Cities Fall 18.2%. Lets take a look at some more of the article -

The decrease in the S&P/Case-Shiller index was in line with forecasts and followed an 18.1 percent drop in October. The gauge started falling in January 2007, and year-over-year records began in 2001.

Record foreclosures have contributed to more than $1 trillion in losses worldwide that have prompted banks to shut off access to credit. While plunging values have made homes more affordable, they have also hurt household wealth, contributing to a slump in spending that’s likely to continue for the first half of the year.

“The housing market has not yet reached its bottom,” Neal Soss, chief economist at Credit Suisse Holdings in New York, said in an interview on Bloomberg Television. “People have to be in a position where they are not afraid of their most significant asset.”

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Other housing reports have shown property values continue to weaken as foreclosures climb. The median sales price of existing homes fell 15.3 percent in December from a year earlier, compared with a 13.6 percent annual decline the prior month, the National Association of Realtors said yesterday.

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U.S. foreclosure filings jumped 81 percent last year as more than 2.3 million properties got a default or auction notice, or were seized by lenders, according to RealtyTrac Inc., an Irvine, California-based seller of default data.

The faster the correction the faster we reach bottom... or does the bottom just keep getting further and further away. Since the only real bottom is zero - not 30% off peak or 20% off peak - we won't know the real bottom until some time after we hit it. But with all the recent layoff notices we still have some ways to go.