The media today are telling us what we already know: the United States is firmly in the grip of a double-dip recession, at least so far as home values are concerned. Shannon Bond has the details for the Financial Times:
US home prices slumped for an eighth straight month in March, dropping below the bottom previously recorded in the housing bust in a sign of the persistent weakness of residential real estate.
A separate report showed consumer confidence sagged in May as Americans grew more pessimistic about the job market and inflation expectations rose.
Prices of single-family houses in the 20 largest US cities fell 0.2 per cent from February to March on a seasonally adjusted basis, according to the S&P/Case-Shiller home price index. The decline was in line with economists’ expectations and left the index at 138.16, below its low point of 139.26 in April 2009 and the lowest level since March 2003. Prices were 3.6 per cent below their level of a year ago, a bigger dip than the 3.4 per cent expected.
“This month’s report is marked by the confirmation of a double-dip in home prices across much of the nation,” said David Blitzer, chairman of S&P’s index committee. “Home prices continue on their downward spiral with no relief in sight.”
Even as the wider economy has maintained a steady, if sluggish, recovery, the housing market has lagged behind, weighed down by an oversupply of homes for sale and difficult borrowing conditions for many homeowners. The glut of distressed homes, which often sell for as much as a 20 per cent discount, has sapped confidence and depressed prices, discouraging buyers and sellers alike.
Prices fell in 13 of the 20 cities surveyed in March…
[continues in the Financial Times]