October Housing Index Numbers Show Continued Price Decline

With home prices falling in October, the threat of a double dip in US housing is becoming more real. In the month, the Case-Shiller 20-city index showed a …

With home prices falling in October, the threat of a double dip in US housing is becoming more real. In the month, the Case-Shiller 20-city index showed a universal decline. The biggest metros in the 10-city index barely registered growth, with increasing polarity between strong coastal markets like New York and LA, and the nation’s weaker midsection. See the following article from The Street for more on this.

Home prices across the U.S. remained in decline in October, according to Standard & Poor’s Case-Shiller Index, and the data left plenty of room for dire interpretation.

“The double-dip is almost here,” said the David Blitzer, chairman of S&P’s index committee, in a prepared statement. He noted that six cities set new lows for the October period since reaching their 2006 peaks. “There is no good news in October’s report.”

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The Case-Shiller 20-City Composite Index fell 0.8% in October from the same month in 2009. Average home prices across the country have now declined to levels close to where they stood during the worst of the recession in 2009.

The trends even in stronger markets appears to be negative: All 20 of the cities that make up Case-Shillers 20-City Composite Index saw home prices slide in October compared with the previous month.

The 10-City Composite Index, meanwhile, showed home prices inching higher in October by 0.2%, the fifth consecutive month of deceleration and far below the 5.4% growth rate recorded in May. Only four cities — Los Angeles, San Diego, San Francisco and Washington — showed year-over-year gains in home values. The 10-city index tracks residential real estate markets in the nation’s 10-largest metropolitan areas.

Some big cities suffered sharp year-over-year declines. The home price indexes for Atlanta and Chicago dropped 6.2% and 6.5% in October from a year ago, respectively. The index for hard-hit Detroit fell another 5.5%, while Portland’s lost 5.2%.

The split between the large coastal metropolises and the rest of the country continues to widen, according to S&P. Home values in Los Angeles, New York and Washington have held up, still higher by 70% from their levels a decade ago, in 2000. In Detroit, however, home values are now 30% below where they were in 2000. In Las Vegas, Cleveland and Atlanta, prices have reached levels close to those of ten years ago.

Homebuilder stocks lost ground Tuesday, albeit modestly. Shares of Lennar(LEN_), Pulte Group(PHM_), KB Home(KBH_), and Toll Brothers(TOL_) were all down by less than 1%.

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