Economy.com Forecasting Housing Crash
Moody's Economy.com is forecasting that nearly 20 metropolitan areas will experience a "crash" in house prices over the next 24 months, with double-digit price declines, and another 80 metro areas will experience measurable declines. "Indeed, odds are high that national house prices will decline in 2007 -- the first decline in nominal house prices since the Great Depression," says the Moody's residential real estate market outlook report. The biggest price declines will occur along the southwest coast of Florida, metro areas in Arizona and Nevada, nine California markets, throughout the broad Washington, D.C. area, and in and around Detroit, according to Economy.com. Housing prices in Cape Coral, Fla., are projected to take the biggest hit -- off 18.6% from their peak in the fourth quarter of 2005 till they bottom out in the second quarter of 2007. The Washington market won't reach its trough until the second quarter of 2008 after a 12% decline in house prices, the report forecasts. Most California markets will bottom out in 2008, but the drop in prices in the Las Vegas market won't stop until mid-2009 after backtracking 12.9%. The Moody's affiliate can be found online at http://www.economy.com.
