The third quarter brought another dose of persistently disappointing home prices, with the U.S. national home price index up only 0.1% from the second quarter and down 3.9% from year-ago figures, the S&P Case-Shiller report said Tuesday.
The national index decline is not as steep as the 5.8% decline posted in the second quarter, but home prices overall are back to first quarter of 2003 levels.
The report found that the annual rate of change in 14 of the 20 metropolitan statistical areas covered by the report improved in September when compared to August.
The 10-city and 20-city composites saw annual rate declines of 3.3% and 3.6%, respectively. Between the second and third quarter the 10-city index home price index declined 0.4% and 20-city declined 0.6% during that time.
"Home prices drifted lower in September and the third quarter," says David M. Blitzer, chairman of the index committee at S&P Indices. "The national index was down 3.9% versus the third quarter of 2010 and up only 0.1% from the previous quarter.
"Three cities posted new index lows in September 2011 — Atlanta, Las Vegas and Phoenix. Seventeen of the 20 cities and both composites were down for the month," Blitzer said. "Over the last year, home prices in most cities drifted lower. The plunging collapse of prices seen in 2007-2009 seems to be behind us. Any chance for a sustained recovery will probably need a stronger economy."
Year-over-year, Detroit and Washington posted positive annual rates of change and noted an improvement in these rates compared to August. New York, Portland and Washington saw monthly gains between August and September.
"It is a bit disturbing that we saw three cities post new crisis lows," the S&P Case Shiller report said. "For the prior three or four months, only Las Vegas was weakening each month. Now Atlanta and Phoenix have fallen to new lows too. On a monthly basis, Atlanta actually posted a record low rate of -5.9% in September over August."
The relative lack of closed transactions might be exacerbating the downside, the report said.
"The relative good news is that 14 cities saw improvements in their annual rates of change, versus the six that weakened."
