Home Prices Forecast to Drop Below 2009 Values by Early 2011

It's the kind of rocky horror show that everyone's been fearing. According to Altos Research, home prices will continue to decline through the rest of 2010 and start 2011 slightly lower than in 2009. The main reason for the projected drop is shadow inventory, those homes that have yet to reach the foreclosure stage but are already slouching toward default. Because the size and scope of the shadow inventory is notoriously hard to estimate, it is unclear when the subsequent housing recovery will begin. Here's hoping for a high-growth spring.