Home prices up slightly over last year, housing still bottoming out

Portrait of the American home by Antonin Rémond.

Fourth consecutive month of improvement

Although still down from 2010 levels, home prices rose in July for the fourth consecutive month, according to new data out by the S&P/Case-Shiller Home Price Index. Both the 10- and 20-city composite that Case-Shiller report on are up 0.9 percent in July over the previous month, but down 4.1 percent from July 2010.

Seventeen of the top 20 largest cities studied yielded positive monthly increases while Las Vegas and Phoenix dipped slightly and Denver did not changed. Compared to July 2010, Detroit and Washington D.C. were the two cities whose home prices rose, while the remaining cities dropped.

Housing market still bottoming out

“With July’s data we are seeing not only anticipated monthly increases, but some fairly broad improvement in the annual rates of change in home prices,” says David M. Blitzer, Chairman of the Index Committee at S&P Indices. “This is still a seasonal period of stronger demand for houses, so monthly price increases are expected and were seen in 17 of the 20 cities. The exceptions were Las Vegas and Phoenix where prices fell, while Denver was flat. The better news is that 14 of 20 cities and both Composites saw their annual rates of change improve in July.”

Blitzer also noted that “Other recent housing statistics show that single-family housing starts were down slightly in August, and are about 2% below their year ago level; and these levels are at 30-year lows. Existing-home sales, however, were up in August and are about 20% above their August 2010 level. The S&P/Experian Consumer Credit Default indices showed a continuing decline in mortgage default rates, a two-year trend. However, if you look at the state of the overall economy and, in particular, the recent large decline in consumer confidence, these combined statistics continue to indicate that the housing market is still bottoming and has not turned around.”