HOUSING MARKET: Elusive bottom

 U.S. housing prices are in the midst of a decline that may last for years, according to Robert J. Shiller, a finance professor at Yale University.

Shiller, who helped create home-price indexes bearing his name, wrote in a New York Times story yesterday that declines in real estate tend to be relatively long-lasting. As an example, he mentioned land prices in Japan’s major cities, which fell for 15 straight years after a 1980s housing bubble burst.

Less than three years have passed since the Standard & Poor’s/Case-Shiller indexes of U.S. home prices peaked. The S&P/ Case-Shiller national index has fallen 32 percent from a high in the second quarter of 2006.

“Prices may continue to fall, or stagnate, in 2010 and 2011,” Shiller.

Shiller’s article followed an estimate by T2 Partners LLC, a hedge fund, that the national index will hit bottom in mid- 2010 after dropping 40 percent to 50 percent from its high.