Seattle prices are continuing to drop, now at their lowest level since June 2004. The Standard and Poor's Case-Shiller Indices released their report, Tuesday, saying that Seattle, as well as most other metropolitan cities nationwide, continue to have falling prices. Detroit was the only market that showed a monthly gain but with a caveat--their prices are now at 30% below their January 2000 numbers. Atlanta, Cleveland and Las Vegas join Detroit in having prices below their 2000 levels. The average of the 20-city composite was hovering around the 2009 prices.

The Case-Shiller Index follows trends of 20 cities and nineteen of those twenty showed price drops from January to February, causing the index to fall for the seventh month in a row. And prices are falling at a faster rate in 11 of the cities. My feeling is that prices will continue to drop as foreclosures, short sales and vacancies rise, along with the vandalism and deterioration that often piggybacks these, dragging prices down on other single-family residences and neighborhoods.

Large banks were too cavalier and greedy taking homes from homeowners and refusing to work out loan modifications in the interim. Along with the plethora of short sales and REO's we are seeing on the market I believe there is a huge "shadow inventory" of property that the banks continue to amass. These are homes that are in some stage of delinquency, pre-foreclosure, foreclosure or REO status. The banks have somewhat slowed their takeover as they face mild investigations from the government and backlashes from citizens but those Congressional queries along with the continually increasing inventory have not stymied the banks' biggest land grab I've ever seen. They know they can't keep dumping properties on the market as they are tightening lending standards, squeezing more and more citizens out of the housing market. Sellers have lost equity in their homes they can never get back and as the banks ratchet prices even  lower on their inventory the market values drop further.

Conversely, buyers can find screaming deals. They need not even search out a short sale or REO for a bargain. Regular listings have great prices since listing agents have to follow the market. The hard part is often convincing the homeowner that their nest egg is not worth what it once was.

Year over year data showed only 3 cities having bigger losses than Seattle's at -7.5. Those were Chicago at -7.6%, Minneapolis at -8.3% and Phoenix at -8.4%.

The other cities that comprise the 20-city Case-Shiller Index are Atlanta, Boston, Charlotte, Cleveland, Dallas, Denver, Las Vegas, Los Angeles, Miami, New York, Portland, San Diego, San Francisco, Tampa, Washington DC. The indices show 10 and 20-city composites of single-family home prices and are published on the last Tuesday of each month for the second previous month. We'll see if prices continue to fall is as many cities next month.