Some housing bubble news from Wall Street and Washington. Reuters, "House prices fell a record 2.5 percent in May, the Nationwide Building Society says. The monthly decline, the largest since the lender started compiling records in 1991, wiped 5,000 pounds off the value of the average home and took prices 4.4 percent lower than a year ago -- the sharpest rate since the 1992 economic slump."

"Prices have now fallen for seven months running -- the longest stretch of falls in 26 years when the last housing market crash plunged millions of Britons into negative equity, or owing more on their mortgage than the value of their home."

"'The sheer size of the drop in house prices, without the economy having yet slowed significantly, suggests that this housing market correction will be deep and prolonged,' said Seema Shah of Capital Economics."

"'All this is with the support of a still relatively healthy labour market. Imagine then, what will happen to house prices once the economic downturn gathers pace and unemployment rises,' Shah said."

"Two-thirds of British households own their homes, making prices an extremely emotive issue up and down the country."

"'Correlation between house prices and consumer spending in the UK is high, and indeed it is the highest among major industrial countries,' said Michael Saunders, economist at Citigroup."

From Bloomberg. "KeyCorp fell the most since the stock-market crash of 1987 after doubling its forecast for loans that won't be repaid, prompting concern that regional banks have underestimated the cost of bad mortgages."

"The revision by the Ohio bank, which last month quadrupled its provision for loan losses to $187 million, may foretell similar increases at U.S. commercial banks as home prices keep sliding, analysts said."

"'Banks are a little bit delusional right now about when they're going to turn around,' said said Mark Fitzgibbon, an analyst at Sandler O'Neill & Partners LP. 'Recessions don't turn around in days or weeks or months. It's a multiyear kind of thing.'"

"Banks are concluding that they must unload foreclosed properties to get the properties off their books, said Jeff Davis, an analyst at FTN Midwest Securities in Nashville. 'We're getting to the point where reality is sinking in and the sellers are cutting prices,' Davis said. 'The deeper we go into the year, the more foreclosed properties trading hands will impact the data.'"

The Atlanta Journal Constitution. "Synovus Financial Corp. said it has turned to auctions to speed up the disposal of foreclosed homes, many of which are concentrated in the Atlanta area."

"Synovus CEO Richard Anthony said the Columbus-based banking company is in the 'fifth inning' of dealing with its credit problems stemming from the nationwide meltdown of home values and mortgage defaults."

"Almost 12 percent of Synovus' $1.67 billion residential loan portfolio, or $199 million, is classified as nonperforming, accounting for more than half of its problematic home loans, according to the bank's presentation."

"'Our attention is more focused on turning the ... assets in Atlanta than it is in Florida,' said Anthony, because it is a much bigger share on Synovus' problem loan portfolio."

The Houston Chronicle. "Kenneth Hocking watched as the auctioneer began to drop the prices on his Inner Loop duplexes, in hopes that someone in the audience would start the bidding. $225,000 ... $200,000 ... $170,000."

"When he hit $100,000 and the audience remained motionless, the auctioneer moved on."

"'It's a reflection of the market,' said Keith Jaehne, a commercial real estate broker and investor who attended Wednesday's real estate auction. 'There are a lot of new houses on the market without a lot of activity.'"

"We're in a correction period," said Kelly Toney, co-owner of Tranzon VenueBid, the real estate auction franchise running the event. 'That was very evident today.'"

"A handful of the 25 properties being auctioned didn't get a single bid.'

"'Buyers are leery of prices falling further,' Toney said. 'They don't feel like the market has bottomed out yet.'"

"The high bid on a 3,000-square-foot duplex on Hutchins near the Museum District was $75,000. It was a court-ordered sale, however, and the minimum bid had been set at $135,000. Several Midtown townhomes were left unsold, as no one was willing to pay the $315,000 and $415,000 minimums."

The Detroit News. "Metro Detroit home builders, battling a nearly three-year slump in new home sales, are sweetening their deals to lure scarce buyers. They not only are dropping prices, but also are offering to buy customers' existing houses...and throwing in upgraded fixtures and finishes that just a few years ago would have cost thousands extra."

"In addition, some builders have put empty lots up for sale in hopes of recovering at least part of their investment."

"'We're talking price declines of 30 and 40 percent at least,' said Russ Long, director at a Birmingham-based financial firm that is acting as a bank-appointed receiver for financially troubled builders in Metro Detroit. 'It's a more acute drop with new properties than existing ones.'"

"'This is stacking up as the most dramatic housing contraction in the post-World War II period,' said David Seiders, chief economist for the National Association of Home Builders."

"In some cases, even drastic price reductions and free upgrades haven't helped to move some new homes."

"Wake-Pratt Construction Co.'s Cedar Pines of Troy subdivision included plans to build 17 luxury single-family homes, some with price tags in excess of $650,000. But three years after Wake-Pratt broke ground on the project, only three home sites have sold, and the latest top listing price is right around $550,000, though there hasn't yet been a sale this year."

"Those prices include thousands of dollars' worth of upgrades like granite counters, his-and-hers sinks in the bathrooms and upgraded fixtures. Just a couple of years ago, such extra amenities wouldn't have been included."

"Some companies, including Bloomfield Hills-based Pulte Homes Inc., have been aggressively selling excess land and speculative home inventories to boost their bottom lines."

"'Nobody is even talking about building homes unless they're build-to-suit,' said Long, the bank-appointed receiver. 'There's no money in empty lots.'"

From Post Dispatch. "For local house builders looking for an end to the housing market slump, April didn't offer much hope. In the St. Louis region, the number of building permits sunk in many counties to levels not seen in at least six years."

"The pace of sales is still not where most in the industry would like. Chris Jones, president of Columbia, Ill.-based CA Jones Inc., has experienced that first hand. Sales at his company are off about 40 percent from an average year, Jones said."

"'April is usually one of our hot months. We could sell five or six houses easily,' he said. This year he sold three. But the month was still better than March, Jones said, when he sold just one house."

"And the buyers in the market are bargain shopping, Jones said, because there is such a large supply of houses. 'There have been weekends when we had one person visiting the display,' Jones said. 'It is very discouraging to the sales people.'"

The Gazette. "Amid an atmosphere of homes waiting months to sell and the number of foreclosures in the state having passed 11,000, one Prince George's County builder is offering homebuyers the chance to rent before they buy."

"'It's not something we usually see in the new home arena, even in this market,' said Katie Maloney, executive VP of the Maryland State Builders Association."

"Atkinson Properties & Builders' homes are at least 3,000 square feet and brick-based, feature four to five bedrooms with ceiling fans, four or more bathrooms, whirlpool baths, gas fireplaces, in-law suites or sun rooms and fully finished basements."

"Buyers pay Atkinson an initial nonrefundable down payment, usually $20,000, and then provide monthly rental payments until they are ready to purchase the home. Most Atkinson homes go for around $600,000, with renters paying about $3,700 each month; $1,000 of this goes toward the final purchase. Jean Atkinson, president, took in more than $309,000 in revenues last tax period but says she is closer to breaking even now."

"'I've had a tenant now that still hasn't bought in almost five years. I've had to refinance her house; it was either that or ask her to leave,' Atkinson said. 'They have realized it's cheaper to rent the house as long as they can without buying.'"

From ABC News. "In nearly every American metropolis, the housing downbeat goes on, and the numbers in some cities are staggering. At the bottom of the heap is Las Vegas. Once America's fastest growing city, it has seen home prices tumble 26 percent since last year."

"Not far behind is Miami, where the condo craze crumbled and overall housing prices are down almost 25 percent. The other big losers are in the West: Prices in Phoenix, Los Angeles, San Diego and San Francisco are each down more than 20 percent."

"Homeowner Deborah Gorman and her husband decided to sell their home in Pittsburgh when they took new jobs working for an insurance company in New Mexico in 2005. But by the time they put their house on the market, the Pittsburgh metro area was already glutted with inventory."

"'We did lower the price significantly, dropped it by about $25,000; at this point, we really just want to be able to pay off the mortgage so that we can kind of move on and not have the stress of owning a house 1,700 miles away,' Deborah said. 'Once the house had been on the market for nine months, we were starting to get a little bit more than discouraged that it really wasn't going to sell.'"

"Their original listing price was $150,000, but since then, the Gormans have dropped it $25,000. Her realtor recently told them that he has had clients in comparable situations sell their house for less than their mortgage."

"'It is really kind of disillusioning to realize that, after 20 years, you're really going to walk away with not much,' Deborah said."

"She hoped to have a small gain from selling her house for a future home, but now that 'hope has evaporated.'"

"'It's disheartening when you think you've done everything right. You have a lovely home and it's in a great area and it just won't sell. You really are at the mercy of the market,' she said."