By Mark Huffman
ConsumerAffairs.com
October 27, 2009
Homeowners who have seen their home equity disappear over the last couple of years and now seeing some of it return. The price of the average U.S. home rose in August for the fourth straight month, according to the S&P Case-Shiller Index.
The composite index of home values in 20 select metro areas rose 1.2 percent in August from July, a better than expected performance. However, prices are still lower than they were a year ago.
The 10-City and 20-City Composite Home Price Indices declined 10.6 percent and 11.3 percent, respectively, in August compared to the same month last year. Nineteen of the 20 metro areas and both Composites showed an improvement in the annual rates of decline with August's readings compared to July. Cleveland was the only exception.
"Broadly speaking, the rate of annual decline in home price values continues to improve" said David M. Blitzer, Chairman of the Index Committee at Standard & Poor's. "The two Composites and 19 of the 20 metro areas showed an improvement in the annual rates of return, as seen through a moderation in their annual declines. Looking at the monthly data, 17 of the MSAs and both Composites saw price increases in August over July."
While many of the markets remain down versus this time last year, the relative rate of decline has shown some real improvement, according to the report. California, in particular, has seen some real positive prints in recent months.
"We see this general trend whether you look at the as-reported data or the seasonally adjusted figures," Blitzer said. "Once again, however, we do want to remind people of the upcoming expiration of the Federal First-Time Buyer's Tax Credit in November and anticipated higher unemployment rates through year-end. Both may have a dampening effect on home prices."
Even those the two composites remain lower year over year, most are showing an improvement over the previous month's figures. Dallas and Denver are continuing their trend from the past month, edging closer into positive territory with August figures of -1.2 percent and -1.9 percent, respectively. In addition, both New York and San Diego have emerged out of double-digit declines. New York was down 9.6 percent in August and San Diego was down 8.9 percent.
In the monthly data, only Charlotte, Cleveland and Las Vegas reported monthly declines in August over July. Minneapolis and San Francisco reported positive returns greater than +2.0 percent, and nine of the MSAs plus the two Composites reported monthly returns greater than +1.0 percent.
