The Housing Chronicles Blog: Home price declines slowing: what does it mean?

Tuesday, August 26, 2008

Home price declines slowing: what does it mean?

Not surprisingly, the latest S&P/Case-Shiller index shows home prices continuing to decline in the 20 cities it includes for its monthly survey. However, during the last month those price declines starting to slow, which some analysts suggest may point closer to a housing bottom. Still, one month does not make a trend. From an AP story via

A widely watched index released Tuesday showed home prices dropping by the sharpest rate ever in the second quarter, but the data for June suggest the severity of the housing slump may be waning.

The Standard & Poor’s/Case-Shiller U.S. National Home Price Index tumbled a record 15.4 percent during the quarter from the same period a year ago.

The monthly indices also clocked in record declines. The 20-city index fell by 15.9 percent in June compared with a year ago, the largest drop since its inception in 2000. The 10-city index plunged 17 percent, its biggest decline in its 21-year history...

However, the rate of single-family home price declines slowed from May to June, a possible silver lining, the index creators said...

Fourteen cities in the monthly index showed improvement from May to June; nine recorded positive returns.

The index’s glimmer of hope follows another surprisingly positive housing headline on Monday. Existing home sales rose in July, surpassing expectations, as buyers snatched up cheap distressed properties in the hardest hit housing markets.

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