Real Estate Is Not Recovering

Headlines and media outlets have interpreted the resiliency in home prices since 2009 as a sign of recovery in the battered sector. Investors and potential home owners rushing to secure great deal will only find themselves squeezed by another round of bad information. While U.S. dollar (nominal) prices have stabilized, they have not kept pace with the rate of currency devaluation since 2001. The charts below illustrate the severity of this decline.

Either follow the message of the market or get out of the way.

U.S. Median Home Price (MHP) And MHP to Gold Ratio


S&P Homebuilders Index (HB) AND HB to Gold Ratio


Headline: Home-price index at lowest point since 2006 bust

Home prices in major areas have reached their lowest level since the housing bubble burst in 2006, driven down by foreclosures, a glut of unsold homes and the reluctance or inability of many to buy.

Prices fell from February to March in 18 of the metro areas tracked by the Standard & Poor's/Case-Shiller 20-city index. And prices in a dozen markets have reached their lowest points since the housing crisis began. Prices in March rose only in the Seattle and Washington, D.C., metro areas.

The nationwide index fell for the eighth straight month.

A record number of foreclosures are forcing prices down, and they are expected to keep falling through this year.

Source: finance.yahoo.com