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American home prices tumble

Freefall continues and likely to impact the Canadian market.

Across much of the United State, home values are dropping – even those backed by solid mortgages – and banks are repossessing more every day. Most experts say the dive won't hit bottom for another year and only after excess inventory is sharply reduced and credit markets improve.

"The housing value crisis is spreading and deepening," said David Abromowitz, a senior fellow at the Center for American Progress. "It has gone way beyond sub-prime borrowers stretched too far with bad loans and now has clearly extended into the housing markets more broadly."

U.S. home prices dropped 8.9 per cent in the final quarter of 2007 compared with a year ago, according to the Standard & Poor's/Case-Shiller home price index released earlier this week. That marked the steepest decline in the index's 20-year history.

"We reached a sombre year-end for the housing market in 2007," said Robert Shiller, one of the architects of the S&P/Case-Shiller index. "Home prices across the nation and in most metro areas are significantly lower than where they were a year ago. Wherever you look, things look bleak."

Many observers of the Canadian marketplace believe that our real estate market, particularly in the Toronto area, will soon follow the current trends in the United States.

March 2, 2008 in World View [of real estate] | Permalink

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Comments

I am under impression that the Toronto real estate market is neither doomed nor expanded. It is absolutely standard trend that it is on the way of following the current trends in the United States. This is the trend not just when speaking about real estate but also about market as well.

Posted by: Toronto realtor | Mar 6, 2008 9:35:55 AM

Many observers of the Canadian marketplace believe that your real estate market, particularly in the Toronto area, will soon follow the current trends in the United States.

So when the prices will going down -25 % because is a real trend in USA and still will going down.
Many observers also said that the real price in the Toronto area is market from 2000, and still I can not see any decrease.

Posted by: Mike | Mar 3, 2008 1:52:41 PM

I am under impression that the Toronto market is doomed. Overheated to the point of no return. The tide is turning and the "not very high priced condo market" is going to be hit and hit hard. Bring it on!

Posted by: water | Mar 2, 2008 4:40:41 PM

I'm under the impression that Toronto prices - at least for condos - really aren't that high, relative to other comparable cities in the world.

Posted by: Re: money | Mar 2, 2008 11:22:33 AM

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