Overnight the flood of bad news in relation to the US housing market continued unabated.

The Freddie Mac home price index fell 1.3 percent on an annualized basis in the quarter, the biggest quarterly drop in 25 years. The index is constructed from actual sales prices and appraised values of homes whose mortgages are being refinanced.

It’s no wonder that Bush administration officials are desperately trying to come up with some kind of solution for borrowers in trouble and it should be sending some shivers up the spine of Rudd, Gillard, Swan and their newly minted team of economic conservatives.

Unlike the United States, home borrowers in Australia still tend to blame the government for rate rises, despite the fact we have an independent central bank.

Florida highlights just how nasty this US housing market collapse could get. During the boom, prices in Miami were often up 3-4% per month and now only about 10% of homes in Miami are affordable for residents earning the area’s median income, according to the Housing Opportunity index.

The good news is that a cursory glance through reports such as the one released last week by the Office of Federal Housing Oversight is that Miami and the rest of Florida are getting cheaper as the market really starts to unwind. The bad news is that a lot of people have borrowed heavily with no equity and their house prices are falling very fast. Even if they keep their house, it will be because they stop spending and using the house as an ATM. That is also very bad news for the consumer-driven US economy.

The slew of data on US housing continues to paint a very negative picture, although to a certain degree one gets the impression that investors are almost getting desensitized to all this bad news. They shouldn’t and here is one statistic that should really cause concern.

RealtyTrac, which collects data on foreclosures, last week reported a 94% year-over-year increase in foreclosure filings for October. In other words, there is now a default notice, auction sale notice or bank repossession for one in every 555 US households. In Florida, it is one in every 273 households.