- Kara JohnsonMarch 27, 2012 - MortgageLoan.com
Tuesday, Mar 27, 2012
U.S. home prices fell again in January, dropping to their lowest level since the housing crash occurred, according to the latest Standard & Poor’s/Case-Shiller Home Price Indices.
Home prices in the index of 20 major U.S. cities showed a monthly decline of 0.8 percent in January, dropping to their lowest level since the beginning of 2003. All told, average home prices are now down 34.4 percent since peaking in 2006.
The continued deterioration in home prices comes despite other recent positive trends in the housing market and the economy in general, including stronger home sales compared to one year ago and increasing consumer confidence.
It’s not clear if increasing sales of foreclosed properties, which sell at a steep discount compared to regular transactions, are a factor in the decline. Many analysts have been expecting lenders to begin moving more aggressively to clear out a backlog of foreclosed properties in the current year.
Annual rate of change improves
Compared to one year ago, home prices in the 20-city index are down 3.8 percent from their January 2011 level. That’s a smaller 12-month decrease than the 4.1 percent annual decline reported for December, which could be taken as a good sign. Improvements or deteriorations in the annual rate of change are often predictors of broader trends in the housing market, although in recent month the rate of change has been irregular.
Only three of the 20 cities in the index – Miami, Phoenix and Washington – showed monthly price gains in the current report. Three others – Denver, Detroit and Phoenix – were the only ones to show annual price increases over January 2011, with gains of 0.2 percent, 1.7 percent and 1.2 percent, respectively.
Atlanta is currently the worst-performing housing market of the 20 cities, with an annual price decline of 14.8 percent, followed by Las Vegas with a 9.0 percent annual drop.