This probably doesn’t come as a surprise to you if you’ve been following the housing market, but according to a new CoreLogic report, home prices declined again in November. The data provider found that prices declined 1.6 percent from October to November. The index is only 1.2 percent above its post-bubble March 2009 nadir, and is now roughly at the same level it was in 2004.
This dovetails with a report from Zillow earlier today that home values have dropped 26 percent since the 2006 peak of the market. This now surpasses the losses observed during the Great Depression.
Mark Fleming, chief economist for CoreLogic, commented in a press release:
“We’re continuing to see the influence of seasonal declines that typically depress home prices during the latter part of the year, but the fact that the rate of decline increased for November is indicative of the uphill battle we’re facing with the housing recovery.”
I’ve discussed the reasons for the continued decline in home values ad nauseum in this space, but in a nutshell, it boils down to the fact that there is a massive supply of unsold homes in the United States, and little demand for them. Barring a sudden and dramatic shift in the country’s economic fortunes, the equilibrium price will continue to shift downward. Unfortunately we will probably see a lot more reports like this before the situation improves.
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