Housing market ‘grim’

NEW YORK – U.S. home prices fell in October for the 10th consecutive month, posting their largest drop since early 1991, according to a key index released Wednesday.

The record 6.7 percent slide in the Standard & Poor’s/Case-Shiller home price index also marked the 23rd consecutive month that prices either fell or grew more slowly than the month prior.

“No matter how you look at these data, it is obvious that the current state of the single-family housing market remains grim,” Robert Shiller, who helped create the index, said in a statement.

The previous record decline was 6.3 percent, recorded in April 1991. The index tracks prices of existing single-family homes in 10 large U.S. cities, none of which is in Washington or Idaho.

Nevertheless, the index is considered a strong measure of home prices nationally because it examines price changes of the same property over time, instead of calculating a median price of homes sold during the month.

A second, broader Case-Shiller index, which measures 20 metropolitan areas – including Seattle and Portland – fell 6.1 percent in October. .

Seattle, Portland and Charlotte, N.C., were the only three cities in that broader index to post year-over-year home price appreciation in October.

Patrick Newport, an economist with Global Insight, said only Charlotte is expected to be spared from declining prices, because the area has not seen periods of rapid appreciation.

Home prices nationally could fall another 10 percent over the next 12 to 18 months before bottoming out, Newport said.

Sales of homes will likely start to rebound late in 2008, with price appreciation to follow, Newport said.