According to article by Reuters, Standard & Poor's/Case-Shiller is reporting that home values fell -19% in January from last year, this is the largest year over year decline on record. In other words despite all of the efforts by the government, home value losses are actually accelerating.
All 20 of the metro areas that are included in the report showed a decline in home values from last year.
Additionally, home values for the 20 metro index are down 29.1% from their peak in the second quarter of 2006.
Ordinarily I don't put too much stock in past appreciation because it represents only what happened last year, it is not an indication of what is going to happen this year. But what is alarming is that when you consider that the real estate market has the identical month's supply of housing in February of 2009 as it did in February 2008 with a 9.7 month supply, there is every indication that this year is not going to represent a housing bottom as many people have been calling for.
And the reason we are not going to see a housing bottom this year is because none of the efforts by the government have stimulated demand for real estate. In other words, the home values are still being driven down by the excess supply of homes. Until we get the excess supply of homes sold, the market will continue to deteriorate. The pace at which foreclosed homes are coming to the market continues to keep pace with the number of buyers entering the market for the first time.