Recent home-price gains starting to vanish
LOS ANGELES — The home price gains made after the housing market bottomed in spring 2009 have vanished, with 10 cities posting fresh lows in February, according to a closely watched index that tracks home prices in America’s biggest metropolitan areas.
The Standard & Poor’s/Case-Shiller index for 20 major U.S. cities, released Tuesday, came within a hair of its previous bottom hit in April 2009. The renewed drop in home prices indicates the nation’s housing woes continue despite a recovery in the broader economy.
“There is very little, if any, good news about housing. Prices continue to weaken, while trends in sales and construction are disappointing,” said David M. Blitzer, chairman of the index committee at Standard & Poor’s.
The Case-Shiller index showed prices dropped 3.3 percent from February 2010 and 1.1 percent from January amid weak demand for homes and a strong market presence for cheap foreclosures and other “distressed” properties.
Other than Washington, all of the major cities tracked by the index posted a year-over-year decline.
When left unadjusted for seasonal variations, nearly every city declined. Detroit was the only city that saw a gain, up 1 percent.
Foreclosures remain a significant part of the market and probably will remain so for the foreseeable future as borrowers continue to fall behind on their mortgage payments.
The Case-Shiller index has fallen to nearly the same level it was in April 2009, the last time it bottomed, evaporating the gains made last year after a popular tax credit for buyers fueled sales nationally. Experts predict prices will continue to fall this year, pushing past their previous lows into a much-feared double dip.
Ten major cities posted fresh lows. Those cities were Atlanta; Chicago; Las Vegas; Miami; New York; Phoenix; Seattle; Charlotte, N.C.; Portland, Ore.; and Tampa, Fla.
Atlanta, Cleveland and Las Vegas joined Detroit with home prices below their 2000 levels in February. Phoenix is barely above its January 2000 level.
The Case-Shiller index compares the latest sales of detached houses with previous sales and accounts for factors such as remodeling that might affect a house’s sale price over time. From those data, an index score is used to show price changes.