With foreclosures high and demand weak, home prices in a majority of the nation's largest metropolitan areas posted fresh lows in December and pushed a widely watched index of real estate values close to a double-dip decline.
The Standard & Poor's/Case-Shiller index showed that prices in 20 major U.S. cities dropped an average of 2.4% in December from the same month a year earlier and 1% from November, the fifth straight month the index has fallen.
And experts said things could get worse.
"My intuition rates the probability of another 15%, 20%, even 25% real home price decline as substantial," said Yale University economics professor Robert Shiller, co-creator of the index. "That is not a forecast, but it is a substantial risk."
His partner, Karl E. Case, a Wellesley College economics professor, noted that the nation also could see a quick turnaround.
"It looks very much like a rocky bottom with a downward trend [now], so it is discouraging," Case said. "It's possible the mood could change, and the mood could change very quickly."
The dismal news comes on the heels of rising gas prices as political unrest in Libya and other oil producing nations has shaken investors. The Dow Jones index of 30 blue-chip stocks lost 178 points, or 1.4%, on Tuesday.
