Home prices dipped lower than anticipated from Sept to Oct as outlined by an industry report. October’s plunge was also the biggest year-to-year drop reported by the Standard & Poor’s/Case-Shiller home price index since the end of last year. The consensus was the expiration of the homebuyer tax credit was becoming evident and a housing industry double-dip is unavoidable.
Seeing the Case-Shiller home price index
In October month-to-month home prices fell in 18 of 20 markets surveyed by the Case-Shiller home price index. A bad Sept would means a flat Oct as outlined by housing industry experts. There was a much worse decline in value of homes last summer. This was after the homebuyer tax credit ended. Home prices in the 20 markets fell 1.3 percent from September to October, an annualized decline of 15 percent. Atlanta was hit hardest with a 2.1 percent drop in home values. There were five markets that hit all time lows since the 2007 housing sector collapse. These took place in Tampa Fla.; Seattle; Portland, Ore.; Miami; and Charlotte, N.C.
Housing market double-dip
The double dip that has been warned about continuously may be hit soon according to the chairman of the S&P/Case-Shiller home price index committee. Oct home values show a huge decrease from the peak in July 1006. It was a 30 percent dip. A backlog of foreclosures waiting within the wings will continue downward pressure on home prices in 2011. Over Dec. 2009, you will find 50 percent more homes for sale. Millions of homeowners preparing to sell are standing by for signs the housing sector will recover.
2011 winners and losers within the housing market
The sustained decline in home values is bad news for Realtors. However, news about a housing sector double-dip is good news for homebuyers. Since homebuyers are waiting for the real estate sector to bottom out, there has been a 25 percent decrease from December 2009 of homes being bought according to the Case Shiller home price index. It is not all good news. A catch is there. It will be a lot longer before economic recovery happens with the depressed real estate industry. This just shows consumer confidence is really low along with high unemployment. The 2011 economic growth is something economists are optimistic about. Unfortunately, in 2011, there is anticipated to be another 3 percent decline in houses.
Information from
Bloomberg
bloomberg.com/news/2010-12-28/u-s-property-values-decline-more-than-forecast-in-s-p-case-shiller-index.html
CNN Money
money.cnn.com/2010/12/28/real_estate/home_prices_fall/?npt=NP1
Wall Street Journal
online.wsj.com/article/SB10001424052970203513204576047491075731426.html?mod=googlenews_wsj
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