Home Prices Rise at a Slower Pace

Home Prices Rise at a Slower Pace
By DAVID STREITFELD
Copyright by The New York Times
Published: November 24, 2009
http://www.nytimes.com/2009/11/25/business/economy/25home.html?hpw


The modest recovery in home prices is beginning to falter, according to data released Tuesday.

The Standard & Poor’s/Case-Shiller home price index, a closely watched measure of 20 metropolitan areas, barely rose in September, increasing 0.3 percent on a seasonally adjusted basis.

Nine of the cities in the index fell in the month, including Boston, Seattle, New York and Charlotte.

“This may be a bit of a transition period,” said Maureen Maitland, vice president for index services at Standard & Poor’s.

The index had increased strongly during the summer, most recently by 1.1 percent in August. Only four cities fell in August.

The Case-Shiller index covers about 45 percent of the United States housing market. Also released Tuesday was the S&P/Case-Shiller National Home Price Index for the third quarter, which covers about 75 percent of the market.

The national index showed an 8.9 percent decline in the third quarter of 2009 versus the third quarter of 2008, a substantial improvement over the 14.7 percent decline in the annual rate of return reported in the second quarter of 2009.

The Case-Shiller numbers lag by a month the report on existing home sales, which was issued earlier this week for October. Existing home sales jumped 10.1 percent to the highest level in two years, better than analysts had expected. Much of the increase was attributed to the $8,000 first-time buyer’s tax credit.

While increased sales should push up prices, Ms. Maitland said the overabundance of inventory was acting as a brake on that process. “You can look down the street and have 10 houses to choose from,” she said.