Tuesday, September 25, 2007

More Bad News About Housing – The Beat Goes On

According to an article from CCMoney.com the National Association of Realtors (NAR) reports that the sale of existing homes is down again in August.

Housing markets continued to slump across the nation in August as the number of existing homes sold dropped for the 13th straight month, according to the latest report from the National Association of Realtors.

Sales fell 4.3 percent from July to a seasonally adjusted annualized rate of 5.50 million. Sales have fallen 12.8 percent since last August's pace of 6.31 million homes. . . . .

. . . . . The slump pushed up the inventory glut to 4.58 million existing homes, the highest level in 16 years. There is now a 10-month supply of homes on the market at the present rate of sales. (my emphasis)

In another article from CNNMoney.com, Moody’s Economy.com is predicting a further decline in single family homes in most major metropolitan areas. The article is worth a read and includes a table of major cities and their forecasted decline in housing prices.

Over the next few years, more than three-quarters of the nation's housing markets will suffer some decline in home prices. Many will experience double-digit hits in a forecast that has worsened considerably in recent months.

According to an analysis conducted by Moody's Economy.com, declines will exceed 10 percent in 86 of the 379 largest housing markets. And 290 of the cities will experience price drops of 1 percent or more.

Nationally, Moody's is projecting an average price decline of 7.7 percent. That's a jump from the 6.6 percent total price drop that the company was forecasting in June and more than twice that of last October's forecast of a 3.6 percent price decrease.

Many of the worst hit cities are in Sun Belt areas that experienced outsized home-price growth during the real estate bubble, according to Arnold Slesers, an associate economist at Moody's.

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