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Further price drop for US homes | Further price drop for US homes |
(about 14 hours later) | |
The price of existing homes in the 10 largest US cities fell by 0.6% in July - the steepest drop in 16 years - a survey has found. | The price of existing homes in the 10 largest US cities fell by 0.6% in July - the steepest drop in 16 years - a survey has found. |
The data, from S&P/Case-Shiller home price index, put the annual price fall in those cities at 4.5%. | The data, from S&P/Case-Shiller home price index, put the annual price fall in those cities at 4.5%. |
A broader survey of 20 cities found that prices fell in 15 of them, dropping an average of 0.4% from June to July, and down 3.9% on July 2006. | A broader survey of 20 cities found that prices fell in 15 of them, dropping an average of 0.4% from June to July, and down 3.9% on July 2006. |
Large numbers of unsold existing and new homes have hit prices. | Large numbers of unsold existing and new homes have hit prices. |
"The further deceleration in prices is still apparent across the majority of regions," said Robert Shiller, chief economist at MacroMarkets LLC. | "The further deceleration in prices is still apparent across the majority of regions," said Robert Shiller, chief economist at MacroMarkets LLC. |
Recession risk | Recession risk |
The cities where prices are still rising are Atlanta, Charlotte, Dallas, Portland and Seattle. | |
However, these have reported that growth is slowing, the index compilers said, with Atlanta and Dallas moving closer to negative territory. | However, these have reported that growth is slowing, the index compilers said, with Atlanta and Dallas moving closer to negative territory. |
Analysts say that tight credit conditions - making it harder for people to get mortgages - are continuing to dent the market for house sales, which is already weak. | Analysts say that tight credit conditions - making it harder for people to get mortgages - are continuing to dent the market for house sales, which is already weak. |
The housing slowdown and decline in credit availability have triggered worries that the economy could go into a recession - prompting the US Federal Reserve to slash interest rates earlier this month from 5.25% to 4.75%. | The housing slowdown and decline in credit availability have triggered worries that the economy could go into a recession - prompting the US Federal Reserve to slash interest rates earlier this month from 5.25% to 4.75%. |
Last week, Mr Shiller told politicians that the loss of a boom mentality among consumers posed a "significant risk" of a recession within the next year. | Last week, Mr Shiller told politicians that the loss of a boom mentality among consumers posed a "significant risk" of a recession within the next year. |
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