Home prices fell 0.5% in March compared with February in 20 major U.S. cities, according to the Case-Shiller home price index released Tuesday by Standard & Poor's.
"The housing market may be in better shape than this time last year; but, when you look at recent trends there are signs of some renewed weakening in home prices," said David Blitzer, chairman of the index committee at Standard & Poor's.
"It is especially disappointing that the improvement we saw in sales and starts in March did not find its way to home prices," he said in a statement.
There's been recent renewed weakness in housing prices as tax incentives end and foreclosures rise, S&P noted. Nationally, home prices are back at spring 2003 levels, according to S&P.
"Now that the tax incentive ended on April 30th, we don't expect to see a boost in relative demand," Blitzer said.
The biggest month-to-month decline came in Detroit, where March prices dropped 4.1%. The biggest monthly rise was in Cleveland, where prices gained 1.8%.
In the past year, prices were higher in 10 of 20 cities, led by a 16.2% rise in San Francisco. The largest annual decline was 12% in Las Vegas.
Looking ahead, prices should be firmer in May and June due to increased sales from the tax credit, wrote Ian Shepherdson, chief U.S. economist with High Frequency Economics, in a research note.
"That effect will then fade in the summer as sales drop back, and prices could easily head into the fall a bit lower than they are now," Shepherdson wrote.
Elsewhere Tuesday, the Federal Housing Finance Agency reported that U.S. home prices were 1.9% lower in the first quarter than in the fourth quarter, seasonally adjusted. Over the year, prices were down 3.1%. The FHFA index is based on repeat sales of homes financed by Fannie Mae or Freddie Mac.
No comments:
Post a Comment