Economy packs triple punch of bad news

By James Thorner, Times Staff Writer
In print: Wednesday, April 30, 2008

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A flurry of punishing economic news landed squarely on the Tampa Bay area Tuesday.

Foreclosures are rising, consumer confidence is still falling and, to top it off, a national index reported housing prices in February fell at the fastest rate ever.

Home prices dropped in February in all but one of the 20 cities tracked by the S&P Case-Shiller Index. The sole uptick was a 1.5 percent increase in Charlotte, N.C.

In the Tampa Bay area home prices fell 17.5 percent year over year, Case-Shiller said. Prices have returned to April 2005 levels after peaking in July 2006.

Foreclosures also set records in the first quarter, with 87,893 Florida properties falling into default, the firm RealtyTrac said. Tampa-St. Petersburg-Clearwater ranked 21st worst in foreclosures, though Miami, Fort Lauderdale, Orlando and Sarasota performed even worse.

The lender that underwrote much of the state's housing boom is paying the price. Countrywide, the giant mortgage company, reported Tuesday that it lost $893-million in the first three months of this year.

All this is leaving consumers feeling woozy and wobbly. National consumer confidence has dipped to its lowest point since March 2003, at the start of the Iraq war. Florida's consumer confidence dropped four points to 66 in April, surpassing a 16-year low recorded earlier this year, a University of Florida study reported.

Can the government help stem the negative trend? Today, the Federal Reserve is expected to cut interest rates by a quarter point, easing credit to levels not seen since late 2004.