American homes are worth $1.7 trillion less

^ That's a headline from CNN Money this morning which points to the loss in value of American houses since last year. From the article:

   American homes are expected to be worth $1.7 trillion less in 2010 than they were worth last year, according to a report released Thursday by real estate website Zillow.

   This year's drop in home values is 63% bigger than the $1 trillion dip in 2009, and brings the total value lost since the housing market's peak in 2006 to a whopping $9 trillion.

   Instead of leveling off from the $1.0 trillion loss in home values in 2009, the value destruction is accelerating again and the carnage will continue for a few more years. My timetable remains 2018 before any recovery in real estate is evident and prices begin appreciating again. Will real estate values eventually recover entirely to their highs in 2006-2007? Yes, I think so. The market has a short memory and when the good times are rolling again, old manias will reappear. It wouldn't be natural if booms and busts didn't cycle like the seasons.