The long-predicted correction in U.S. housing prices has apparently begun.
The median selling price fell for the first time in 11 years last month, on an annual basis, pushed lower by the largest glut of unsold homes since 1993, and some economists fear the worst may lie ahead.
The price fall comes amid concerns that the U.S. housing slump could quickly spread to other areas of the economy as consumers react to the falling value of their nest eggs. In recent years, homeowners have used the equity built up in their homes to finance their lifestyles. A U.S. downturn now could also spill over into dependent economies, including Canada’s.
But wait, there’s more!
Analyst says of new data: ‘Pop goes housing bubble’,
The year-over-year drop in median sales prices represented a dramatic turnaround in fortunes for the once high-flying housing market, which last year was posting double-digit price gains.
“Pop goes the housing bubble,” said Joel Naroff, chief economist at Naroff Economic Advisors. He predicted prices will fall further as home sellers struggle with a record glut of unsold homes.
Fresh evidence poured in Monday that the national and Bay Area housing markets are declining sharply.
The California Association of Realtors reported that statewide home sales year to year fell 30.1 percent in August, the greatest decline since the housing market was facing double-digit interest rates in the early 1980s.
Sometimes, just the headlines say it all – that’s all most people see anyway:
Housing Market Slows Further
Home prices finally hit wall
Annual Existing Home Sales Prices Tumble
Home sales keep dropping