Homeowners See No End to Falling Home Values

Nearly two of every three U.S. households said their house price fell in 2008, double the number who said that a year earlier and up five times from 2006, and they expect prices to fall faster this year, according a Reuters/University of Michigan survey on Friday.

Homeowners expected an annual average 2.2 percent drop in the year ahead, twice the rate of decline they expected in a survey conducted in the fourth quarter, the survey found.

The data provide no indication that consumers think the decline in home prices is nearing a end, but instead that even larger and more widespread declines in home prices are now expected, survey director Richard Curtin wrote in the report.

The record 61 percent of homeowners saying their home price fell last year suggests the worst housing market since the Great Depression is less likely to rebound before 2010, according to the survey.

Foreclosures will continue to escalate as home equity keeps falling below outstanding mortgage balances, and homeowners will remain intent on rebuilding their savings and reserve funds, the survey said.

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