For the tenth consecutive month in a row, the median price of a home in the U.S. has fallen. The median price of a home sold in May was down 2.1% from a year ago.

Ten straight months of falling home prices is a new record. The number of resale homes sold in the U.S. fell in May to the lowest level in four years, according to the National Association of Realtors.

I'd like to remind my readers -- make that stress to my readers -- that house prices will likely fall in the U.S. this year for the first time since the Great Depression. The psychological impact to consumers seeing the price of their home drop will "hit home" with American consumers in 2008.

U.S. homeowners and potential buyers are dealing with tighter lending requirements and rising interest rates. Add to this combination the fact that the inventory of unsold homes in the U.S. is now at a 4.43 million units (highest inventory level since 1992) and the housing market has all kinds of troubles.

Lately, I have been writing often about the U.S. housing market for the simple reason I believe the contraction and economic damage being caused by this sector is being severely underestimated by analysts. As consumer confidence continues to plummet as the values of their homes decline, consumer spending retracts, the stock market contracts, and recession sets in.

Talking about the stock market, it was the Dow Jones U.S. Home Construction Index (comprised of the largest new home builders in the U.S.) that first tipped us off about the hard landing in the U.S. property market. This index topped out in mid-2005 and is now officially down 50% from its 2005 peak while it continues its freefall.

There is no doubt in my mind: The crashing U.S. housing market will have dire repercussions for the U.S. economy over the next few years.