S&P: Home Prices May Drop Another 10%

S&P has issued a forecast which says home prices could drop another 10% through next year.

The new research says that:

“While U.S. home prices have stabilized considerably since the recession officially ended in mid-2009, recent housing data suggests that the winter season will likely chill recently improving home prices, according to a new report published by Standard & Poor’s Ratings Services In line with this expectation, Standard & Poor’s Ratings Services believes home prices will decline an additional 7%-10% through 2011.”

The news is shattering. The S&P Cash-Shiller Index has shown some improvement, albeit modest, over the last few months. But, foreclosure rates have increased according to RealtyTrac. The number of mortgages underwater still stands at over 11 million, about 21% of all home loans in the US. Fed governor Rifkin recently commented that foreclosure rates would get no better in 2011 and would barely improve in 2012. (more)