House prices to drop much lower: Greenspan

Reuters reports Friday:

Greenspan said in an interview with Austrian magazine Format…

“It’s a difficult situation, there is an enormous overhang on the real estate market,” Greenspan was quoted as saying. “Many buildings which just have been finished can’t be sold …”

“So far, prices have dropped only slightly. But it was enough to cause alarm around the world,” he said. “Prices are going to fall much lower yet.”

See also:

LA Times: “U.S. home prices declining at their fastest pace in two decades”
Home prices dropped 3.2% in the second quarter compared with the same period last year, according to the S&P/Case-Schiller quarterly index, which tracks existing single-family home price trends in major metropolitan areas.

It was the worst decline in the 20 years since the price barometer was inaugurated, said Robert Shiller, chief economist for MacroMarkets, a division of Standard & Poor’s that calculates the index.