Real Estate Prices in the United States Now at 2004 Levels

When home prices started declining as a result of the growing crisis in the mortgage industry, many analysts did not expect for the national home price average to drop as far as the pre-boom period. But it did, according to a report from Standard & Poor’s.

It seems that whatever gains that the real estate industry has earned over the past four years have actually been erased. For April, the S&P/Case-Shiller Home Price Index was pegged at 169.85. this index is slightly higher than that of August 2004’s index of 167.43.

Homebuyers who are hoping for positive home appreciation values will certainly be devastated with the current performance of real estate properties. In the last four years, whatever equity they have earned evaporated.

Another report from the Office of Federal Housing Enterprise Oversight showed that market values of low-priced homes have reached December 2005 levels. Although the two reports used different criteria in measuring home price decline, their conclusion is still the same – prices are indeed dropping nationwide.

Real estate experts and financial analysts are also predicting that home prices could decline further considering the large inventory of foreclosed properties, sluggish home sales, skyrocketing fuel prices, rising consumer debt and the lack of buyer interest. Cities with the largest home price decline include Las Vegas (26.8%), Miami (26.7%), Cleveland, Denver and Chicago.

Even Charlotte, NC posted a 0.1% annual home price decline for April which came as a surprise for most analysts. This city has always posted positive annual growth in terms of home prices in the past several months.

Only real estate investors looking to enjoy considerable savings will be delighted with these reports. For sure, they are seriously considering themselves lucky for being able to buy prime real estate at bargain prices, not too mention the greater return potential that foreclosed properties offer.

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