Home construction up slightly in September; home prices could fall again

The U.S. Census Bureau recently reported that construction spending in September increased 0.2 percent from August, with an annual rate of $787.2 billion. While spending on new home builds increased in the private sector, many housing experts believe home prices will fall for a third time in 2012.

Analysts at Fiserv predict the U.S. housing market has yet to hit rock bottom, and housing prices will likely fall again next year. The analysts expect prices to experience a triple-dip, with home values declining another 3.6 percent by June 2012, putting home prices at a new low 35 percent below the 2006 peak.

In an interview with CNNMoney, David Stiff, Fiserv's chief economist, said many external factors will be holding back the housing market next year and values will suffer as a result. Stiff foresees an increase in foreclosure activity, continued high unemployment and an unsettled debt crisis in Europe pushing the home values to the lowest dip since the market crashed.

The Huffington Post reported that many major lenders shut down their foreclosure activity this past year to review previous foreclosure actions that could be subject to litigation for shoddy practices. These lenders will be done with their internal reviews of potentially erroneous paperwork by 2012, and a new wave of foreclosures that have been delayed will fill the housing market and further depress home values.

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