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Home Prices Dropping: Good News for Bargain Hunters

According to a report recently released, the Standard and Poor’s/ Case-Shiller 20-City Housing Index has once again dropped — this time by 18 percent from October 2007. Unfortunately, this figure represents the sharpest decline in the history of this particular housing index.

For David Blitzer, Chairman of the Index Committee, the current home prices have gone down to their level in March 2004.

The report only confirms that the US housing market has yet to recover from a collapse which was spurned by large inventories of foreclosure properties, sluggish home sales and poor economy.

Experts are even advising the public that things could still turn worse as the bottom has yet to be hit before any long-term housing recovery can be felt. Both the local and federal government have been working hard to find a long-term solution to the foreclosure mess, allowing more distressed homeowners to stay in their homes.

With home prices dropping fast, the forecast for the entire industry is certainly not looking good. Of course, it is not always the bad news that should be focused on. A lot of home buyers are actually taking advantage of the current market condition. Interest rates are low and although lending guidelines are tighter, it could mean more protection for these potential buyers.

For buyers with excellent credit standing and have enough cash for down payment, there is nothing stopping them from owning homes that were once beyond their reach. Indeed, even with such a bad situation, there is always a silver lining.

Among the properties attracting the most attention are the foreclosure homes. Nationwide, inventories have reached millions and majority of home buyers are considering them over existing or newly-built houses. Not only are these homes more affordable, they also provide instant equity. For investors, they are certainly worth every penny.

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• California Foreclosures Continue to Surge
• 2008 Foreclosure Records in Florida and California Implies Worse 2009