Report says U.S. home prices fall by 1.3 percent in October

Report says U.S. home prices fall by 1.3 percent in October

2010-12-29 10:45:25 GMT+7 (ICT)

NEW YORK (BNO NEWS) -- A study carried out in 20 U.S. cities in the month of October showed that home prices decreased by 1.3 percent compared to September, and 0.8 percent year-over-year, a report released on Wednesday by S&P/Case-Shiller said.

While housing prices are still above their spring 2009 lows, six cities - Atlanta, Charlotte, Miami, Portland (OR), Seattle and Tampa - hit their lowest levels since home prices started to fall in 2006 and 2007, meaning that average home prices in those areas have fallen beyond the recent lows seen in most other markets in the spring of 2009.

In October, the annual growth rates moderated from their prior month's pace confirmed a clear deceleration in home price returns for the fifth consecutive month.

"The double-dip is almost here, as six cities set new lows for the period since the 2006 peaks," David M. Blitzer, Chairman of the Index Committee at S&P. "There is no good news in October's report. Home prices across the country continue to fall."

Over the past few months, trends have not changed. Blitzer explained the tax incentives are over and the national economy remained lackluster in October.

"Existing homes sales and housing starts have been reported for both October and November, and neither is giving any sense of optimism," Blitzer added "On a year-over-year basis, sales are down more than 25 percent and the months' supply of unsold homes is about 50 percent above where it was during the same months of last year."

In addition, housing starts are still hovering near 30-year lows. However, as of October, average home prices across the United States are back to the levels where they were in mid 2003.

According to the report, index levels of 68.86 in Detroit indicates that average home prices are more than 30 percent below their January 2000 values. Las Vegas, Cleveland and Atlanta are just about back to their 2000 levels, with October prints of 100.97, 102.20 and 103.30, respectively.  

On a relative basis, Los Angeles, New York and Washington D.C. have fared best, retaining the most of their mid-2000 price appreciation. Each of these markets is more than 70 percent above their January 2000 levels, the study said.

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