On a day many Americans headed to the malls to return ill fitting or ill conceived presents, the latest housing numbers showed extended weakness in the housing sector. Perhaps those shoppers who charged gifts in the hopes a housing rebound would allow them once again to lean on home equity headed back to return high priced gifts as the S&P Case-Shiller Home Price Index for October showed declining returns for the 23rd consecutive month and showed a year on year decline for the 10th consecutive month. The 10-city Composite declined 6.7%, a record low. The previous largest decline, 6.3%, occurred in April 1991.
“No matter how you look at these data, it is obvious that the current state of the single-family housing market remains grim,” says Robert J. Shiller, Chief Economist at MacroMarkets LLC and creator of the index. “Not only did the 10-City Composite post a record low in its annual growth rate, but 11 of the 20 metro areas did the same.”
The continued deterioration of the housing market does not bode well for the economy as retail numbers for the holiday shopping season so far have come back disappointing.
It is apparent that the subprime fallout is only getting worse as the tendency of many Americans to use their home equity as a bank account has meant that the end of the housing boom put people in trouble let alone actual declines in housing values, which is now in full swing.
