Home Prices, Confidence Fall

Home prices fell by 0.2% between February and March, according to the latest Case-Shiller report. The average single-family home now costs less than it did in April 2009, which was previously considered the low point of the housing crisis.
This basically confirms the double-dip theory proposed by many real estate experts during the first quarter. While the drop in prices doesn’t represent a huge loss by comparison with 2009, it does virtually erase any progress the market had made since then. As a result, interest rates are expected to stay low and home-ownership is expected to become more affordable than ever.
In a less-than-shocking coincidence, consumer confidence fell considerably in May. While “consumer confidence” as measured by the business world at large is not strictly tied to real estate values, it does provide an insight into the state of the economy as a whole and our perception thereof. The beginning of 2011 saw a lot of optimistic talk about recovery and growth, but it seems we have a while to wait before that recovery turns into cash, credit, or new jobs.