Home Prices Hit Record Slump

Fourth-quarter report from National Association of Realtors shows largest price drop on record as markets with price declines now outpace those with gains. The report indicated that the decline was far more widespread and deeper than expected and more than ever before.

Prices fell an average of 2.7% in the fourth quarter when compared to the fourth quarter of 2005. It was the largest drop on record and included declines in 73 metropolitan areas. Only 5 markets saw prices unchanged. Vacation markets like southern California and southern Florida were especially hard hit.

When compared to the?third quarter where 45 markets saw declines these numbers are a clear sign the market has not turned. It has not even leveled off yet and as expected this year will be a bumpy ride.

Of course, with things heating up in the middle east anything is possible but I suggest homeowners leave remaining equity alone and be cautious making new purchases.

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