Housing Prices: Still Headed Down

The latest news is really bad for developers selling houses:

That decline reflects two things: first, that we builders have constructed far more homes than Americans need, and second, that they are facing reality that there are too many homes.  To sell, you need to cut the price.  Here’s how the supply of new homes looks:

That horizontal line is the average inventory of unsold homes.  At the rate we’re going, well get there in June 2010.  Maybe a little faster, or a little slower.  But not next month, or even next year.