Inquiring minds are looking at data from the Federal Housing Finance Agency showing U.S. home prices fell 4 percent in the fourth quarter from a year earlier as record foreclosures sapped the confidence of homebuyers:
The drop was the 13th consecutive year-over-year[SC editor’s note: this should have read quarter-over-quarter] retreat and the largest since 2009’s third quarter, the Washington-based agency said today in a report. Prices fell 0.8 percent from the prior three months. On that basis, economists projected a 0.6 percent decline, the median estimate in a Bloomberg survey.
Foreclosures discourage potential buyers who want to avoid price retreats because they sell at a discount, devaluing other homes. The share of people who intend to buy property dropped to 4.4 percent in February from 5.2 percent in January, according to the Conference Board, a New York-based research firm. Sales of foreclosed homes accounted for 37 percent of transactions last month, up from 36 percent in December, the National Association of Realtors said in a report yesterday.
More data showing that the housing crisis is worsening:
The share of homes in foreclosure rose to 4.63 percent in the fourth quarter, matching an all-time high set in the first three months of 2010, according to the Mortgage Bankers Association in Washington. The combined share of mortgages in foreclosure or delinquent was 14 percent, about 1 in every 7 home loans, the trade group said in a Feb. 17 report.
These are frightening data.
It is just that simple.
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