The Financial Times reports today that home prices are currently falling at a rate never before recorded:
The Standard & Poors/Case Shiller 10-city index of single-family house prices contracted by 13.6 per cent year-on-year in February, the most since records began in 1987.
The broader 20-city index fell 12.7 per cent compared with a year earlier, the biggest drop since the index’s inception in 2001.
Are there any signs of a bottom? S&P says just the opposite, that price declines are actually accelerating:
…with repeat sale prices in the 20-city index falling by 2.6 per cent in February, compared with 2.4 per cent in January and 2.1 per cent in December.
This might have been what billionaire real-estate investor Eli Broad was thinking yesterday when he spoke at the Milken Institute Conference. From Bloomberg:
Eli Broad, a philanthropist and co- founder of KB Home, the fifth-largest U.S. homebuilder by revenue, said he expects home prices to drop another 20 percent.
“I don’t think we’re anywhere near a bottom in housing,” Broad told Bloomberg TV at the Milken Institute Conference in Beverly Hills, California. “We’re going to have a big inventory of unsold, unoccupied homes that’s going to take three or four years to clear out.”
Them’s the facts.
Fall in US house prices accelerates
The Financial Times
KB Home’s Broad Says Home Prices May Drop Another 20%
Rhonda Schaffler and Bob Ivry