Saturday, May 03, 2008

$6 Trillion Housing Loss

A Washington think tank is warning that housing prices are falling at an accelerating level, destroying wealth at a pace that will cost the average homeowner $85,000 in lost wealth this year alone.

The projections by the Center for Economic and Policy Research are based on the numbers in Tuesday's Case-Shiller home price index, which showed accelerating price declines in most big cities.

The annual rate of price decline over the last quarter was 24.9% in the 20-city index and 25.8% in the 10-city index," the center said in its Housing Market Monitor today. "At this rate of price decline, the excesses of the housing bubble will have largely disappeared by the end of the year. At the same time, the price decline implies an incredibly rapid loss of wealth.

In real terms, the rate of price decline in the 20-city index would imply a loss of almost $6 trillion in real housing wealth over the course of the year, an average of $85,000 per homeowner."

Disappearing now: $6 trillion in housing wealth

1 comment:

45north said...

accelerating price declines in most big cities.
As the last car on the roller coaster reaches the top the train starts to accelerate - up till then the first cars are just pulling the last up.

I've just tuned into to Mr. Mortgage
does anyone know anymore about him than his blog?