US Home Prices Plunged by a Record 6.1% in October

28 December 2007

NEW YORK: According to the latest raft of data released by credit ratings agency Standard & Poors, October witnessed one of the worst plunges in US home market values since the year the nation entered World War II - sixty-six years ago.

The data, published Wednesday, shows house prices in eleven of 20 large metropolitan areas posted record declines in October. While the The S&P/Case-Shiller Home Price Index fell in 17 of those areas.

Yale University economics professor Robert Shiller, co-author of the index, asks rhetorically: "When was the last time we had a bigger drop than this? It looks like 1941."

Home prices rose in just three of the twenty cities surveyed during October: Charlotte, North Carolina; Portland, Oregon; and Seattle.

But Global Insight's US economist Patrick Newport, said he expects prices in Seattle and Portland to go into reverse by the end of this year.

This is the S&P index of the areas surveyed (in alphabetical order):

    Atlanta -0.7%

    Boston -3.6%

    Charlotte +4.3%

    Chicago -3.2%

    Cleveland -4.5%

    Dallas -0.1%

    Denver -1.8%

    Detroit -11.2%

    Las Vegas -10.7%

    Los Angeles -8.8%

    Miami -12.4%

    Minneapolis -5.5%

    New York -4.1%

    Phoenix -10.6%

    +Portland, Oregon +1.9%

    San Diego -11.1%

    San Francisco -6.2%

    Seattle +3.3%

    Tampa -11.8%

    Washington, DC -7.0%

    Composite 20 -6.1%
Professor Shiller expects prices to fall another 5% to 7% in 2008.

Data sourced from USA Today; additional content by WARC staff