Wednesday, May 30, 2012

The decline continues

U.S. home prices fall 2.6% in March, S&P/Case-Shiller index shows

Home prices in 20 major cities fell 2.6% in March compared with the same month a year earlier, according to the Standard & Poor's/Case-Shiller index. The gauge is down about 35% from its peak before the housing bubble burst in 2006.

Posted by mark @ 09:53 AM (1111 views)
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2 thoughts on “The decline continues

  • happy mondays says:

    As they say we follow America ! However not much of that yet, Maybe the whole supply & demand, money in London, + the mentality that prices will not crash / fall is working..

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  • It’s all good for sentiment. Once the psychological barrier is broken, in this instance 35% then prices can fall lower.

    Headline prices in Ireland are down around 50% but looking at the market you can expect further falls. The problem with the US like Ireland is misallocation of capital building homes that no one want (until the next bull market).

    The UKs misallocation of capital was very different. Far fewer houses were built in comparison, therefore prices of existing stock has just been bid up.
    The way to reverse the UK bubble is either by further restrictions on mortgage lending, higher interest rates and resulting bankruptcy of the over-borrowed, building more houses to increase supply.

    There are some areas in US (WILDEMERE , Detroit) and Ireland (Ballinasloe, Galway) where you really can’t give the property away due to houses being located where nobody (not even the landlords) wants them.

    In the UK If you put a nice house up for sale even in the crappiest area of Pontypool, Wales it will still get bid up to a kings ransom even if there is little viable work in the area.

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