US house prices 'in record fall'

Private survey of 20 largest cities shows 19 per cent decline in January from a year ago.

    More than one million homes have been foreclosed on
    since the subprime crisis began [GALLO/GETTY] 

    Dallas, Denver and Cleveland showed the smallest declines of around five per cent in January compared to the same period last year, the survey said.

    House prices in the 20-city index have plummeted 29 per cent from their peak in summer 2006, while the 10-city index has fallen by 30 per cent.

    Continuing decline

    The US housing market has crashed during a recession and global financial turmoil sparked in part by the subprime mortgage crisis, when many Americans took out high-interest loans they could not afford to repay.

    More than 1.4 million homes have been foreclosed on in the US since the subprime meltdown began in 2007, leaving many homeless.

    Last week, the US National Association of Realtors said sales of previously occupied homes unexpectedly jumped in February by the largest amount in almost six years as first-time buyers took advantage of deep discounts on foreclosed properties.

    However, may economists expect prices to keep falling for the rest of this year and possibly longer.

    "We continue to believe that it is unlikely that we are anywhere near a bottom in nationwide home prices," Joshua Shapiro, of the MFR Inc analysis firm, said.

    SOURCE: Agencies


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