Home prices post record drop

[USA TODAY]

Existing home prices post record decline, and more drops to come, economists say

By Noelle Knox, USA TODAY
With so many For Sale signs hanging in front yards, home prices — which posted a record 3.5% drop last month — are likely to fall through the end of the year, the National Association of Realtors said Tuesday.

The median existing home price fell in October for the third month in the row to $221,000 as more sellers were forced to lower their asking prices. Those price cuts, coupled with a dip in mortgage rates, appear to be making a difference as home sales ended a six-month losing streak and unexpectedly edged up 0.5% in October.

With a 7.4-month supply of homes for sale, "sellers will have to overcome their state of denial and start dropping prices even more to clear this market," says Joel Naroff, chief economist of Naroff Economic Advisors. "And once that happens, we will then have to convince buyers that prices have stopped falling. We are a long way from that point."
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http://www.usatoday.com/money/economy/housing/2006-11-28-existing-home-sales_x.htm