us-home-prices-how-low-can-they-go

US home prices: How low can they go?

Prices continue to plunge, but the US housing market doesn't appear to be turning around just yet, writes Standard & Poor's chief economist.
Even if one isn't reading a newspaper or watching the news, the problems plaguing the US housing market are in plain sight. Just look at all the for-sale signs in the front yards of most neighbourhoods. What's less apparent is how the effects of the ailing market are extending far beyond prospective buyers, would-be sellers, and banks and mortgage companies. Indeed, if not for the decline in residential construction activity, real growth in the US in 2007 would have been 3.0%, above the average of the preceding two years, instead of slowing to 2.0%. And that's after taking the high oil prices into account.

A healthy housing market is important to the well-being of the...
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