Housing prices continue to drop in U.S.

The Standard & Poor’s/Case-Schiller Home Price Index has nearly reached its previous low, according to numbers released this week. There has turned out to be no rebound yet in the U.S. housing market this year as some had hoped, and it may not happen at all in 2011. The index declined 3.9% during the fourth quarter of 2010 over the previous quarter, and down 4.1% from the final quarter of 2009.

According to the New York Times, Robert Schiller, a Yale professor who helped develop the index, said there was a “substantial risk” the U.S. housing market could drop as much as 25%. The index is already off 31.2% from its peak, according to the release.

The national index is now within a percentage point off the low set in the first quarter of 2009, said David Blitzer, Chairman of the Index Committee at Standard & Poor’s.

“Despite improvements in the overall economy, housing continues to drift lower and weaker,” he said.
Some 18-20 cities were down from the start of 2010. Cities such as Chicago, New York, Miami, Phoenix, Seattle and

Las Vegas hit their lowest levels since home prices peaked in 2006 and 2007.

Cleveland and Las Vegas now have lower average home prices than they were in January 2000. Detroit was in that dubious group prior to the December figures.

Between November and December, the only city not to drop in price in the index was Washington DC, up 0.3%. On the year, prices in Washington are up 4.1%. San Diego was the only other city in the index’s top 20-size metropolitan areas to show gains in 2010, up 1.7%.

Detroit and Phoenix showed the biggest declines on the year, down 9.1% and 8.3% respectively.

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