Just a quick summary of two articles in the WSJ. The Case-Shiller Housing Price Index (WSJ #1) is down 6.7% for October the worst year-over-year decline since they began measuring the index in 1988. None of this should come as a surprise given the condition of the mortgage lending business and the overstock of homes. A picture is worth 1,000 words. The graphs are from the WSJ online.
By the way, the changes in home prices year-over-year by city are as follows:
Also the the consumers did not pull it off at Christmas. There were numerous signs that the consumer spending was going to be weak this holiday season and they were. According the WSJ #2 article consumer spending was up only 3.6% over last year. If you factor out the gasoline sales it looks like the consumer spending was up only 2.4%. Assuming these price increases are in nominal dollars, the real net increase in spending excluding gas purchases and correcting for inflation is right around 0%. Like I said in an earlier post 2008 is going to be a real interesting year for people that have never "felt" a recession.