Home prices may drop another 25%, Shiller predicts

Thursday, June 9, 2011

BY KATHLEEN LYNN
STAFF WRITER
The Record

Home prices may drop as much as 25 percent, after inflation, over the next five years, economist Robert Shiller, co-founder of the Standard & Poor's/Case-Shiller home price index, said Thursday.

"A 10 to 25 percent further decline in real home prices over the next five years would not surprise me at all," Shiller said at a Standard & Poor's housing summit in New York.

Shiller, a Yale professor, said it's possible that the market will follow the grim path seen in Japan after a 1980s housing bubble. Property values there declined every year for about 15 years, dropping by two-thirds overall, he said.

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