Forecaster Predicts Drop in Home Prices
Daily Real Estate News October 4, 2006
Forecaster Predicts Drop in Home Prices
In one of the starkest views yet of the housing slowdown, Moody’s Economy.com is projecting that housing prices will decline in more than 100 of the nation’s metropolitan areas.
The forecasting firm projects that the median sales price for an existing home will decline in 2007 by 3.6 percent, which would be the first nationwide decline for an entire year in home prices since the Great Depression of the 1930s.Moody’s predicts the biggest percentage price decline will be in Danville, Ill., where prices have already fallen by 18.7 percent from the peak in the second quarter of 2005 to a low point in the first three months of this year.
That setback occurred because of layoffs in autos and other manufacturing industries, which depressed the local economy.The second-biggest decline is projected to occur in the Fort Myers, Fla., area, a fall of 18.6 percent from the peak in the final three months of last year to a low-point for prices that is projected to occur in the second quarter of 2007.Otherwise, the 133 areas with slumping prices are concentrated in the states of California and Florida and the Northeast corridor from southern Maine to just south of Washington, D.C., as well as boom areas of Nevada and Arizona and some depressed sections of the Midwest such as Detroit.
"Prices are going to go down and stay down for awhile. It will take at least a couple of years to work off the excesses of the last decade," says Mark Zandi, chief economist at Economy.com and the principal author of the report.
Source: Associated Press (10/04/2006)
Forecaster Predicts Drop in Home Prices
In one of the starkest views yet of the housing slowdown, Moody’s Economy.com is projecting that housing prices will decline in more than 100 of the nation’s metropolitan areas.
The forecasting firm projects that the median sales price for an existing home will decline in 2007 by 3.6 percent, which would be the first nationwide decline for an entire year in home prices since the Great Depression of the 1930s.Moody’s predicts the biggest percentage price decline will be in Danville, Ill., where prices have already fallen by 18.7 percent from the peak in the second quarter of 2005 to a low point in the first three months of this year.
That setback occurred because of layoffs in autos and other manufacturing industries, which depressed the local economy.The second-biggest decline is projected to occur in the Fort Myers, Fla., area, a fall of 18.6 percent from the peak in the final three months of last year to a low-point for prices that is projected to occur in the second quarter of 2007.Otherwise, the 133 areas with slumping prices are concentrated in the states of California and Florida and the Northeast corridor from southern Maine to just south of Washington, D.C., as well as boom areas of Nevada and Arizona and some depressed sections of the Midwest such as Detroit.
"Prices are going to go down and stay down for awhile. It will take at least a couple of years to work off the excesses of the last decade," says Mark Zandi, chief economist at Economy.com and the principal author of the report.
Source: Associated Press (10/04/2006)
posted by Jeff Foster @ Friday, October 06, 2006
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