Record Home Price Declines Continued in July: Report

Home prices in ten major US cities fell a record 17.5 percent annually during July, according to data released Tuesday by Standard & Poor’s. The S&P/Case-Shiller indices found a 16.3 percent decline among a 20-city index, as well — also a record drop. Despite continuing prices drops, however, index committee chairman David Blitzer suggested there were signs of possible improvement in the data. “There are signs of a slow down in the rate of decline across the metro areas, but no evidence of a bottom,” he said in a press statement. “Little positive news can be found when cities like Las Vegas and Phoenix report annual declines as large as 29.9 percent and 29.3 percent, respectively, and all 20 cities are still in negative territory on a year-over-year basis.” The slowdown in the rate of price declines has been widely reported by various price indexes over the past three to four weeks. On Sept. 24, First American CoreLogic reported that its own price indices were showing a so-called deceleration trend in the rate of price declines in many metropolitan areas. Yet a look at the S&P data confounds the notion of such a trend. The 10-city composite experienced its 10th consecutive monthly decline dating back to October 2007, Standard & Poor’s said. And, month-over-month, it reported a 1.1 percent decline from June to July, compared to a 0.6 percent decline reported one month earlier. The 20-City Composite also reported a monthly decline, though less severe relative to the 10-city numbers. From June to July, it declined 0.9 percent, also up from its previous report of a 0.5 percent decline from May to June. In fact, during July, only six of the 20 cities tracked in the 20-city S&P/Case-Shiller composite were up month-to-month, as opposed to nine cities showing monthly price increases between May and June; the trending suggests that a seasonal bump in home prices is likely wearing off. In contrast, an overwhelming 14 of the 20 cities in the Case-Shiller data saw monthly price trends worsen in July, relative to June. None more than Las Vegas; the gambling capital reported a 2.8 percent drop in prices between June and July, compared to a 1.6 percent monthly drop just one month earlier. The second greatest June-to-July decline was 2.7 percent, reported by Phoenix. Hard-hit Cleveland, where prices are off 7.8 percent from year-ago levels, saw prices drop during July, swinging to a -0.3 percent loss after posting a 0.7 percent gain in June. The Las Vegas market remains the nation’s weakest, S&P said, with an annual decline of 29.9 percent. Both Phoenix and Miami followed with respective declines of 29.3 percent and 28.2 percent. “While some cities did show some marginal improvement over last month’s data, there is still very little evidence of any particular region experiencing an absolute turnaround,” Blitzer said. For more information, visit http://www.standardandpoors.com. Editor’s note: To reach the reporter on this story, send an email to [email protected].