HOME PRICES ACROSS U.S. DOWN OVER 15% SINCE APRIL, 2007 - CHICAGO FARES BETTER!
HOME PRICE DECLINES, SOARING ENERGY PRICES DROPS CONSUMER CONFIDENCE TO LOWEST LEVEL IN 16 YEARS!
Apparently, the Real Estate Market nationwide has not turned around - yet! According to statistics compiled by Standard & Poors, in their Case-Shiller Index of Home Prices, the prices of single-family homes in the 20 Top Metro Areas they survey slid 15.3% in April, versus their year-ago levels. On average, across the U.S., home prices are about what they were four years ago - in 2004.
In a separate survey, the Office of Federal Housing Enterprise Oversight, which oversees Fannie Mae and Freddie Mac-backed conventional mortgage loans in a broader swath of the country, urban and rural, found their average home prices fell 4.6% year over year in April - their lowest measured level since 1991.
The Chicago Metro Area did better, according to the Case-Shiller Index. Home prices here dropped an average 9.3% last April, versus April, 2007. However, the average actually increased across Chicago month-to-month, between March and April, 2008.
Case-Shiller indexes home prices against a January, 2000 benchmark of 100. The April index for Chicago was 151.44, indicating an average home appreciation of over 51% in the past 8 1/2 years. By comparison, the New York Case-Shiller Index for April was 193.93, for Los Angeles - 202.52. Miami - 200.42. The index was 93.79 in Metro Detroit, indicating home price depreciation in that market. Unlike Chicago, these other metro areas experienced index declines in April.
The largest one-year price declines were in Las Vegas (26.8% falloff) and Miami (26.7% drop). The California Metro Areas of Los Angeles, San Francisco, and San Diego, as well as Tampa FL, each experienced year-to-year drops exceeding 20%.
Boston, Portland OR, Dallas, Denver, and Seattle each showed stable or slightly improving index numbers in April, versus March, 2008 - like Chicago.
Click here for the latest Standard & Poors Case-Shiller Housing Index.
While the real estate market across the country struggles to find a bottom, Consumer Confidence has fallen to its lowest level since 1992, according to the Conference Board, a business research group headquartered in New York. In June, their Consumer Confidence Index dropped 7.3%, to 50.4, from the May, 2008 level of 58.1. It's benchmark is based on 1985 figures, and found a confidence peak last July, at 111.9. On average, consumer's anticipation of the state of the economy six months from now dropped to its lowest level since the Board began their surveys back in 1967.
Potential home buyers continue to remain on the sidelines! Only 2.2% of those surveyed by the Conference Board plan to buy a new home within the coming 6 months. In addition, fewer consumers plan to purchase a new car, or major kitchen appliances, or even take a family vacation, between now and the end of 2008.
Concerned about economic growth, along with the threat of continued inflation due, in large part, to unstopped increases in the price of fuel and food, the Federal Reserve Board is expected to leave it's key Fed Funds Rate unchanged when it concludes its two-day policy meeting today. Lowering rates might have some mid-term impact on interest rates for some mortgage and business loans, but lowering rates too far could spark higher inflation. The current Fed Funds Rate stands at 2.0%.
For detailed info, read Kelly Evans and Anton Troianovski's article in today's Wall Street Journal.
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