U.S. Housing Prices Fell 3.4% in the 12-Months Ended in October
U.S. home prices fell more than forecast in the year ended in October, indicating that the housing market continues to be weighed down by foreclosures.
The S&P/Case-Shiller index of property values in 20 cities fell 3.4 percent from October 2010 to October 2011, after decreasing 3.5 percent in the year ended September, the group said today.
The real estate market is now bracing itself for another wave of foreclosures that may continue to put pressure on home prices, indicating that any housing recovery will take time to develop. However, rising builder confidence, a pickup in construction, and fewer unsold new properties for sale are among contradictory signs that would seem to indicate the market is steadying.
The Case-Shiller index is based on a three-month average, which means the October data were influenced by transactions in August and September.
Home prices, adjusted for seasonal variations, fell 0.6 percent in October from the previous month after dropping 0.7 percent in September. Unadjusted housing prices decreased 1.2 percent from September, with 19 of the Case-Shiller index’s 20 cities showing declines. Eleven of those cities slumped by 1 percent or more.
Only Phoenix posted a gain, while Atlanta and Las Vegas posted new post-peak lows. “Atlanta and the Midwest are regions that really stand out in terms of recent relative weakness,” said David Blitzer, chairman of the S&P index committee. “These markets were some of the strongest during the spring/summer buying season.”
For that reason, the year-over-year gauge provides better indications of trends in housing rices, according to the S&P/Case-Shiller group.
Eighteen of 20 cities showed a year-over-year decline, led by a 12 percent drop in Atlanta. Detroit showed the biggest year-over-year increase, with prices rising 2.5 percent in the 12 months through October. Property values in Washington, D.C., were up 1.3 percent.
The index’s 10-city composite declined 3 percent, while its 20-city composite fell 3.4 percent. Below are the 20 cities measured by the S&P/Case-Shiller index, along with their one-year change in prices:
Las Vegas -8.5%
Los Angeles -4.9%
New York -2.0%
San Diego -4.5%
San Francisco -4.7%
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