Home Prices Suffer 6.7 Percent Slide

The record drop also marked the 23rd consecutive month prices where price increases either slowed of declined, according to the report. The previous record decline was 6.3 percent in April 1991.

"No matter how you look at these data, it is obvious that the current state of the single-family housing market remains grim," Robert Shiller, who helped create the index, said in a statement.

A broader index of 20 metropolitan areas showed a price drop of 6.1 percent. Miami posted the largest decline among those markets with home prices falling 12.4 percent in October compared to the same month last year.

Detroit, Las Vegas, Phoenix and San Diego also posted double-digit year-over-year declines, according to the Associated Press.

Home prices are likely to remain under pressure as the recent rise in foreclosures puts even more homes on the market and tougher lending rules add to the process of obtaining a home loan.

"With supply overhang enormous and mortgage financing tougher to obtain, home prices are going to decline considerably further in the quarters ahead,'' Joshua Shapiro, chief U.S. economist at Maria Fiorini Ramirez Inc., a New York forecasting firm, told Bloomberg.

Only three areas -- Charlotte, N.C., Portland, Ore. and Seattle -- posted year-over-year home price appreciation in October. Charlotte posted the largest gains at 4.3 percent.

Recent spikes in foreclosures and fears that homebuyers with adjustable-rate loans have significant increases ahead in monthly payments are also adding pressure to the housing sector. Mark Zandi of Moody's Economy.com told National Public Radio that the tally of foreclosures in 2007 will reach 750,000.

Looking forward, Zandi said, "I think we're in store for at least a million lost properties in '08."

Stocks were down in mid-day trading Wednesday as jittery investors took in the new housing data and mulled troubles in the retail sector.

The International Council of Shopping Centers says its index of retail chain store sales rose 2.8 percent last week, rounding out a sluggish December performance that puts retailers on track for a smaller sales gain than the trade group originally expected for the holiday shopping season.