US housing: Housing blues

When inventories rise, prices fall. That basic rule of economics is in action in the troubled US housing market. It explains why prices have fallen more than in the last housing crisis, in 1990-91, and why further declines are almost inevitable. The prices to watch are those of existing, as compared to newly constructed, homes. The used market accounts for close to nine-tenths of all transactions. In 1990-91, the average price fell by a maximum of 6.4%, according to the National Association of ...