That’s today’s headline on CNN.com, just days after the New York Times wrote an in depth feature about the housing slump and its impact on seniors trying to raise money for a move into assisted living. The S&P Case Schiller Home Price Index recorded a record drop in home prices in the third quarter of this year (during the summer months before the economic crisis really kicked in). Home prices have shrunk back to 2004 levels wiping out home equity gains from almost the last five years.

The Index shows drops in the major markets tracked as: “Phoenix the 12-month loss came to 31.9%. Las Vegas prices plummeted 31.3% and San Francisco recorded a 29.5% decline. The best performing markets, Dallas and Charlotte, N.C., still posted drops of 2.7% in Dallas and 3.5% in Charlotte.

Miami is down 28.4% year-over-year; Los Angeles, down 27.6%; San Diego, down 26.3%; Washington, down 17%; Chicago, down 10.1%; New York, down 7.3%; Boston, down 5.7%; and Denver, down 5.4%.

Detroit is down 18.6%; Tampa, Fla., down 18.5%; Minneapolis, down 14%; Seattle, down 9.8%; Atlanta, down 9.5%; Portland, Ore., down 8.6%; and Cleveland, down 6.4%.”

These numbers do not take into account the impact of the drop in the stock market, increases in foreclosures, growing unemployment or any other bad economic news over the last couple of months. The scary part is how these numbers are going to look once the bad news that started hitting in October and November are factored into the next Index report.

To read more about the Index report, click here.