CLEVELAND (TDB) -- Standard & Poor's is out with U.S. home price data today, and it shows the housing slump appears to be accelerating. In the Cleveland market, existing home prices fell 4.5% from a year ago. Robert J. Shiller, chief economist for MacroMarkets LLC, said the national data reflects 23 straight months of decline.
"No matter how you look at these data, it is obvious that the current state of the single-family housing market remains grim. "
Of course, the Cleveland drop was not the worst . In Miami, housing prices were down 12.5% from last year. But a Miami house purchased in the year 2000 would be worth more than twice its original value. If one could find a buyer in that Florida market, the profit would still be sizable. In the Cleveland area, a house would be up by about 15% in value so far this decade. Not a super return, and the housing dip is gnawing into that gain.
Inquiring minds are wondering: If economists can track the home price declines and call the data "grim," will local tax officials in Ohio be far behind? Certainly, county auditors in Ohio who set property tax values have to notice that housing values are slumping. And sooner or later, they will have to start adjusting the tax values down. And when they do, that will subtract property tax revenues from Ohio's schools, cities, courthouses and public agencies that depend on real estate taxes to fill their treasuries. A day of reckoning is definitely ahead.