The S&P/Case-Shiller index declined 18 percent in the 12 months to October, more than forecast, after dropping 17.4 percent in September. The gauge has fallen every month since January 2007. Year-over-year records began in 2001.

This is interesting ... and foreboding:

“We’re seeing a shift to a housing market that is driven by a poor economy rather than a housing market that’s driven by oversupply,” said Guy Lebas, chief economist at Janney Montgomery Scott LLC in Philadelphia. “The credit problems that hit in October exacerbated the speed of it.”

So just now we're starting to see the bad economy start to have an effect. Just like we've been predicting here for over a year: when job loss kicks in, this will only get worse. The start of the crash coincided with a cyclical high in employment -- only one way to go from there.

The 20-city index is down 23 percent from its 2006 peak. Fourteen of the 20 metropolitan areas showed record declines in the year ended in October.

Home prices decreased 2.2 percent in October from the prior month after declining 1.8 percent in September, the report showed. The figures aren’t adjusted for seasonal effects so economists prefer to focus on year-over-year changes instead of month-to-month. Six cities, including Atlanta, Charlotte, Detroit, Minneapolis, Tampa and Washington, had the largest one- month drop on record.

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