New data from a leading measure of U.S. home prices, the Standard & Poors/Case-Shiller Home Price Indices [1], today pointed to a continued improvement in the annual rate of decline of housing prices. Compared to last month’s readings, the 10-City and 20-City Composites improved, marking over eight months of improvement to these statistics.
While the new data is cause for optimism, several factors temper the apparent trend:
• Continuing price turnarounds of earlier this year have faded. Just seven of the 20 cities in the index saw month-to-month gains.
• Housing starts remain weak.
• Fears persist that the market will be swamped by a wave of foreclosures.
• Numerous government programs for the housing market are set to expire early in 2010.
Overall, with strong sales in recent months working off much of the existing home inventory, plus a Fed with a more stable policy than in the 1980s, the net result, reports S&P/Case-Shiller, is a likelihood that prices will remain flat.
For more, see the S&P/Case-Shiller press release [1].
Links:
[1] http://www.standardandpoors.com/servlet/BlobServer?blobheadername3=MDT-Type&blobcol=urldocumentfile&blobtable=SPComSecureDocument&blobheadervalue2=inline%3B+filename%3Ddownload.pdf&blobheadername2=Content-Disposition&blobheadervalue1=application%2Fpdf&blobkey=id&blobheadername1=content-type&blobwhere=1245200590760&blobheadervalue3=abinary%3B+charset%3DUTF-8&blobnocache=true
