U.S. Housing Sector Is In A Double-Dip Recession

U.S. house prices falls 3.3% from a year earlier in February, reversing almost all of the increases in the preceding year. Meanwhile, residential construction spending is down by 7.8%. The housing sector of the U.S. economy is thus in a double-dip recession.

This is ominous since housing is usually a leading indicator of the economy, though there are exceptions from this such as the 2001 recession when the housing sector continued to boom despite the slump in the rest of the economy. So far, a strong manufacturing sector has counteracted the weakness in housing, but it remains to be seen whether this can continue.