House prices slip in half of U.S. cities

MSN MoneyCentral has more housing news (http://articles.moneycentral.msn.com/Banking/HomebuyingGuide/HomePriceReport.aspx). Much of it is not good, but much depends upon where one is in the country. Some states are relatively stable, while others are seeing really negative market forces developing. The data underline a drumbeat of dismal housing headlines this week:

* RealtyTrac, which collects data on foreclosures, today reported a 94% year-over-year increase in foreclosure filings for October. There is now a default notice, auction sale notice or bank repossession for one in every 555 U.S. households -- though that's actually down from the peak in August.

* A respected gauge of home prices, the 20-city S&P/Case-Shiller Index, reported Tuesday that home prices fell 4.5% in the third quarter compared with the previous year, the fastest drop in the index's 20-year history.

* S ales of existing homes, the largest share of the real-estate market, fell for the eighth straight month -- by 1.2% since September and 20.7% since this time last year, the National Association of Realtors reported Wednesday. It said prices had declined 5.1% over the same period.

* Global Insight, a Boston-area economic analysis firm, predicts the foreclosure crisis will have "profound economic effects in 2008," including a $1.2 trillion loss in home values and at least 1.4 million new foreclosures.

* The Calculated Risk blog quotes Goldman Sachs analysts predicting a "substantial" drop in home values nationally -- about 15%, with possible losses in Florida of 30%. If a recession happens, prices could fall by 30% across the country, the report says.

And yet, housing experts urge homeowners to keep things in perspective: Although home prices have dropped from last year's peak, they still retain most of the value gained in the price run-up from 2001 to 2006, says economics professor John Quigley at the University of California, Berkeley. (Compare the five-year and one-year appreciation rates for the OFHEO-tracked cities here; only one metro area -- Detroit -- is in negative territory.)