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Home Values Erode While Consumer Confidence Remains Near 16 Year Low

Published 07/30/08 Jeff Bennett - Print Article
E-mail - editor@economyincisis.org

Home values continued to fall faster in May from 20 metropolitan areas, continuing their steady decline since January 2007, according to Reuters.

Consumer confidence is correlated to the falling home prices and remains near a 16 year low. Analysts believe while consumer confidence remains low spending will drop.

Source Reuters:

Home prices in 20 U.S. metropolitan areas fell at a faster pace in May, and consumer confidence stayed near the lowest level since 1992 this month, posing a threat to household spending.

…

Home prices have fallen every month since January last year, eroding household wealth at a time when consumers are trying to cope with record fuel costs and the credit crunch. While both of today's figures were higher than economists' estimates, the reports still underscored forecasts for spending to slow in the second half as the stimulus from tax rebates wanes.

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