Home prices have dipped again, in the 3rd straight quarterly drop, down 5.1 percent from a year ago. According to a 5/31/2011 internet article on the CNNMoney website authored by Les Christie, prices are the lowest they have been since 2002. Prices are down almost 38 percent from the peak five years ago according to S&P/Case-Shiller national home price index.
A spokesman for S&P, David Blitzer, said the downward spiral in homes prices continues with no relief in sight.
Mr. Christie pointed out that the housing market went through a brief recovery in mid-2009, recovering nearly 5 percent of losses but resumed a slump after homebuyer tax credits expired last April.
Foreclosures and repossessed homes continue to flood the market, making it difficult for conventionally sold homes to compete and keep their value. This has a devastaing effect on new construction which typically contributes to economic recovery. But new construction frequently cannot compete with today's existing homes. The sale of existing homes does not contribute nearly as much to economic recovery as new home sales which bring with them jobs for construction workers.
And what is the good news? Now may be a good time for people who wish to buy a home at a reduced price or invest in existing homes they fix up for resale or utilize for rentals. Carefully evaluate your own circumstances with specialized professionals so you can make the most of your search and wisely use any investment dollars.
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