Minneapolis home prices

It’s become a broken record of late: Home-price declines breaking records. With the economy on the skids and the subprime crisis still unfolding, home values are getting devoured first. This morning the S&P/Case-Shiller home-price index was released, revealing that the trend doesn’t show any signs of slowing down. The 20-city index showed year-to-year August price declines of 16.6 percent. Minneapolis saw a drop of 13.3 percent over the year period, with a 1 percent decline from July to August.

On the brink of the greatest Wall Street bailout ever, home prices continue to decline nationwide, according to the most recent S&P/Case-Shiller Home Price Index. Data released today reveals that 20-city home-price composite indices have reached record-level declines of 16.3 percent for the period of July 2007 to July 2008. In fact, every city was saddled with a year-to-year decline, with Minneapolis reporting a 13.1 percent price drop.

If the last two years are any indication, sometime in the near future “equity” might become one of those outdated words that sounds stilted and foreign, like “tolerance” and “candor.” For decades, homeowners relied on home equity for capital, wealth, and security. But as the subprime fallout continues, many homeowners are finding home ownership not only a risk, but a serious burden they can’t unload.

Home values nationwide have already plummeted 18.4 percent since July 2006, according to the Standard & Poor’s/Case-Shiller 20-city index. And after Panic Monday’s collapse of Lehman Brothers and the buyout of Merrill Lynch, housing experts say home prices will likely drop much further.