I think this article is quite self explanatory

Source : http://biz.yahoo.com/ap/080527/home_prices.html

Widely watched housing index says home prices fell at steepest rate in 20 years in 1st quarter

NEW YORK (AP) — U.S. home prices dropped at the sharpest rate in two decades during the first quarter, a closely watched index showed Tuesday, a somber indication that the housing slump continues to deepen.

There is really no end in sight despite claims from the officials that the housing crisis has bottom up.  I would think that they are just talking up the market and buying time till the Presidential elections.   As I have repeatedly emphasized, a $1 trillion loss cant be absorbed over such a short period, this will be expected to last for years, no joke on that. There is no quick fix, no pain solution for this.

Standard & Poor’s/Case-Shiller said its national home price index fell 14.1 percent in the first quarter compared with a year earlier, the lowest since its inception in 1988. The quarterly index covers all nine U.S. Census divisions.

The narrower indices also set record declines. The 20-city index tumbled 14.4 percent during the quarter, the lowest since that index was started in 2001. The 10-city index plunged 15.3 percent, a record in its 20-year history.

I won’t expect the stock indexes to take the cue from this and head South.   Drastic measures that needs to be taken at once include no subsidizing any more of such bad loans, please let the invisible hand take over.