Standard & Poor’s stated that US Home Prices declined
The Standard & Poor’s/Case-Shiller 20-city home price index released Tuesday fell 1 percent in November from October. All but one city, San Diego, recorded monthly price declines.
Eight others sank to their lowest levels since prices peaked in 2006 and 2007: Atlanta, Charlotte, N.C., Las Vegas, Miami, Portland, Ore., Seattle, Tampa, Fla., and Detroit, which saw the largest drop at 2.7 percent from the previous month.
Millions of foreclosures are forcing prices down, and many people are holding off making purchases because they fear the market hasn’t hit bottom yet. Many analysts expect home prices to keep falling through the first six months of this year.
“With these numbers, more analysts will be calling for a double-dip in home prices,” said David Blitzer, chairman of S&P’s Index Committee.
Mounting foreclosures will probably throw more properties on the market this year, further depressing prices, homeowners’ equity and construction. The lack of a sustained housing rebound and unemployment above 9 percent are among reasons the Federal Reserve may announce this week it’ll complete a second round of stimulus that will pump $600 billion into the economy by June.
The housing market has been struggling since home-buyer tax credits expired earlier this year. To take advantage of the tax credits, buyers had to sign purchase contracts by April 30.
“A double-dip could be confirmed before Spring,” said David Blitzer, chairman of the index committee at S&P. Blitzer defined a double-dip as both the 10 and 20-city composite indices setting new post-peak lows.
He noted that the 10-city index is 4.8 percent above its April 2009 low while the 20-city index is just 3.3 percent higher than its low that same month.
Unadjusted for seasonal impact, the 20-city index fell 1.0 percent in November after a 1.3 percent decline in October.
“I find it hard to believe that if we get a double dip in home prices we could get the consumer back in a meaningful way. Right now it seems like a coin toss as to whether that’s likely. So I’m disappointed,” said Uri Landesman, president of Platinum Partners in New York.
