Nationwide housing market stabilizing, but New York lags behind

Nationwide home prices showed their first monthly gain in three years in May, according to S&P/Case-Shiller Home Price Index data released today, indicating that the housing market may be stabilizing. But New York isn’t improving as quickly as some other areas.

Home prices within a 50-mile radius of New York City fell 12.2 percent in May from the same month last year, and stayed roughly the same as the previous month, said Maureen Maitland, the vice president of index services for Standard & Poor’s, the provider of the report.

That’s a slight improvement from the previous months. New York prices fell 1.6 percent between April and March of this year, and posted a record decline of 2.5 percent between February and March. Since the data does not include condo or co-op units, the report primarily reflects home prices in the outer boroughs, Connecticut, New Jersey and Westchester County.

But other areas showed more improvement.

Nationwide, the pace of decline is slowing, Maitland said. The Case-Shiller index, providing a gauge of values in 20 major U.S. cities, increased 0.5 percent from April, the first monthly gain since July 2006, the report shows. The index was down 17.1 percent from May 2008, an improvement from April, when it declined 18.1 percent year-over-year.

Thirteen of the 20 metro areas measured by the index saw month-over-month improvements, and eight of them, including Boston, Chicago and Cleveland, saw a monthly price increase of more than 1 percent.

The New York metropolitan area still has the highest index value, 170.51, of any of the 20 cities measured by the index. This indicates that homes in the area have held their value better than homes in the other areas. The index was set at a base value of 100 in January 2000, meaning that homes in the New York metropolitan area have appreciated 70.51 percent since then. New York’s home prices peaked in June of 2006 with an index value of 215.83.

“Over the last 10 years, New York has been one of the markets that has held onto a lot of its value,” Maitland said. As a result, prices here are “better than the national average, but it’s not one of the better performing markets at this point. It’s hovering in the middle.”

Sixteen of the metro areas measured by the index showed double-digit year-over-year declines, with Miami, Las Vegas, Los Angeles, Phoenix, Seattle and Tampa posting their lowest index levels yet. With an index value of 144.59, Miami showed declines of 25.2 percent from last year and a drop of 0.8 percent from last month. Phoenix showed the highest year-over-year declines with 34.2 percent.

This month’s data shows improvement, Maitland said, but she pointed out that spring is traditionally the most active home-buying season of the year.

“We’re approaching this with cautious optimism,” she said. “There are positive indicators, there’s no doubt about it. But you can’t use one month of data to say the market is turning around.”