The Standard & Poor's/Case-Shiller 20-city housing index tumbled by a record 18.2 percent from November 2007, the largest decline since its inception in 2000. In the Seattle area, prices for existing single-family homes declined less than the national average, falling 11.2 percent.
It’s little surprise to John Kilpatrick that Seattle-area home prices keep falling. Many sellers are in the market now due to layoffs or money troubles, unable to wait for a price rebound.
“The only sellers out there in the market are people who are having to dispose of their houses. The only buyers out there in the market are people bottom-fishing for deals,” said the president of Greenfield Advisors, a Seattle-based economic-analysis firm.
A closely watched housing-price index announced Tuesday that prices of existing single-family homes in the Seattle area dipped by 11.2 percent in November compared with the same period the previous year, the worst Seattle has fared in the index since January 2006.
Nationally, the Standard & Poor’s/Case-Shiller 20-city housing index plummeted by a record 18.2 percent from November 2007, the largest decline since its inception in 2000. But those declines may seem less harsh at second glance, said Patrick Newport, an economist with IHS Global Insight.
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“If you adjust for inflation, they’re not record declines,” Newport said. “Home prices are still dropping at about a 20 percent clip, but it’s not as bad as it’s been in the last six months.”
The recession and sweeping layoffs don’t bode well for a quick turnaround in housing prices, however. Newport estimates prices will drop an additional 10 to 15 percent this year.
The cities with the largest declines are those that had the largest housing bubbles. Phoenix, Las Vegas and San Francisco all clocked in annual price declines of more than 30 percent in November, according to Case-Shiller. And December figures likely won’t look much better.
The silver lining might be rising affordability for those priced out of markets around the country. Falling home prices and lower interest rates have reduced monthly mortgage payments by hundreds of dollars for those who qualify.
“Even though we had layoffs at Microsoft, and Boeing is certainly nervous, we still have one of the most solidly healthy and vibrant economies in America,” Kilpatrick said. “I’d certainly much rather live here than many of the other cities in the index.”
Karen Gaudette: 206-515-5618 or firstname.lastname@example.org. Material from The Associated Press
is included in this report.