WASHINGTON (CBS/AP) — A perfect economic storm is sinking U.S. home prices to their lowest level since the housing bubble burst in 2006, driven down by foreclosures, a glut of unsold homes and tighter lending standards.

Prices fell from February to March in 18 of the metro areas tracked by the Standard & Poor’s/Case-Shiller 20-city index. And prices in a dozen markets have reached their lowest points since the housing crisis began. Prices in March rose only in the Seattle and Washington, D.C., metro areas.

The nationwide index fell for the eighth straight month.

A record number of foreclosures are forcing prices down, and they are expected to keep falling through this year.

The 12 cities now at their lowest levels in nearly four years are: Atlanta, Charlotte, Chicago, Cleveland, Detroit, Las Vegas, Miami, Minneapolis, New York, Phoenix, Portland, Ore., and Tampa.

Jill Schlessinger of CBS MoneyWatch.com told KNX 1070 it may take a couple more years to recover from the industry-wide fallout that left the housing market reeling.

“From 2000 to 2006, house prices doubled, and it would not be crazy to imagine that the seven years it took to double, it would take another seven years to clear out all that excess inventory,” said Schlessinger.

The housing sector is struggling even as the overall economy is in the midst of a steady but slow recovery. Some of the worst declines in home prices are in cities hit hardest by unemployment and foreclosures, such as Phoenix, Tampa and Las Vegas.

The Case-Shiller index measures sales of select homes in those cities compared with January 2000. For each of the areas it reviews, the index provides a three-month moving average price. By measuring the sales prices of the same homes over time, the index seeks to gauge market values and conditions.

(TM and © Copyright 2011 CBS Local Media, a division of CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2011 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)

Comments (3)
  1. Lets see? says:

    But wait, ther’s more!

    The media is shorting this story, and the information provided to them is false. This November will be the big bust for all home owners, both those who baught thirty years ago and the suckers that baught in the past 6 years (I am one of those suckers and have watched my home drop in value by half). There are 4.5 million homes sitting in the banks hands waiting to hit the market (forclosures). When that happens at the end of the year, all hell is going to break loose. Many home owners will just toss there keys in the front door and walk. I have seen it in very small numbers in my area to date, but see November as the time the line banks drop the hammer. I hope my numbers are wrong!

  2. ginny says:

    I think you are dead on Let’s See? But if you believe the great Admiistration in Washington.things have so improved that we are almost fully recovered. The sad part is that there are a large number of people who are buying it.

  3. surfbum says:

    I think the housing market will continue to tumble. There are many homes in the process of foreclosure and being short-sold, and more owners are approaching that every day. I think the avalanche has only just started.

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