Home prices dipped nationwide for the fifth consecutive month in January, according to today’s Standard & Poor’s Case-Shiller Home Price Index, providing another blow to the housing market following last week’s disappointing new home sales data.
The 20-city composite index was down 3.8 percent compared to January 2011 and fell 0.8 percent on a month-over-month basis. U.S. home prices are now roughly equal to those in early 2003.
“Despite some positive economic signs, home prices continued to drop. The 10- and 20- city Composites and eight cities – Atlanta, Chicago, Cleveland, Las Vegas, New York, Portland, Seattle and Tampa – made new lows,” said David Blitzer, Chairman of the Index Committee at S&P Indices.
However, Miami was spared some of the bad news as it was one of three cities, including Phoenix and Washington D.C., to post a positive month-over-month change in housing prices. Miami’s index gained 0.6 percent since December 2011. And while housing prices in Miami did stumble 1.9 percent in the last 12 months, that was the seventh best performance among the 20 cities tracked by Case-Shiller and is significantly better than the composite’s 3.8 percent drop.
Appearing on Fox Business, Chandan Economics founder Sam Chandan said the Case-Shiller results are not surprising considering the types of buyers that are active in the current market (see video below). Though sales activity is improving, those deals are being driven by foreclosed properties and all-cash investors looking for discounts, which combine to put more downward pressure on home prices. When the job market improves further and the credit standards relax, home prices will begin to rebound, Chandan said. — Adam Fusfeld