US Home Prices Could Fall Another 25%

Real estate prices declined in nearly every city and region of the US in December, according to the Case-Shiller Home Price Index, pushing US home prices back down to near their lowest levels since the crash began.

The Case-Shiller Home Price Index is within a percentage point of the 2009 low, with 11 of the 20 cities surveyed showing home prices below the lows of the 2009 trough.

As of the fourth quarter of 2010, “average home prices across the United States are at similar levels to what they were in the first quarter of 2003,” according to the report.

While some analysts believe that the worst is behind American homeowners, others are becoming increasingly concerned that so-called “double-dip” scenario market has definitively begun.

This week, Yale economist Robert Shiller, the co-creator of the Case-Shiller Home Price Index and who predicted the looming housing crash in 2006, noted in an interview with CNBC that “price[s] may go down substantially.” In a subsequent conference call, Shiller defined “substantially” as being in the 15% – 25% range.

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