Shocking news indeed. While gasoline, oil, food and commodity prices have risen since the financial crisis, home prices have dropped 26% since their peak in 2006. Why is this so significant? This drop has exceeded the 25.9% drop registered in the five years between 1928 and 1933, a period also know as the Great Depression.
The data is from Zillow, the housing data company (Reuters)
"Many economists expect further price drops, even if there are some anecdotal signs of growing demand, such as in pending home sales data".
Stan Humphries, Zillow's chief economist:
"For the next six to nine months, the larger factors affecting the housing market that will produce more home price declines will be the excess inventory of homes, high negative equity and foreclosure rates, and weakened demand due to elevated employment"Zillow also added that declines are actually accelerating, and "it will take a while before falling unemployment and other signs of economic improvement support the market,"
This inspite of all the funny monye put into the system, TARPs, QEI and QE2, etc. Without them, likely all asset prices woud have dropped, making the crisis worse than the Great Depression.