BAP Blog Report:US home prices decline, highlighting fragility of the market

A closely watched survey reported Tuesday that U.S. single-family home prices declined in September. This report highlight's the fragility of a market as it struggles to get back on its feet. As reported by The S&P/Case Shiller composite index, 20 metropolitan areas fell 0.6 percent from August on a seasonally adjusted basis. Prices in August were also revised to show a decline of 0.3 percent after originally being reported as unchanged. The broader trend here is that it appears that home prices over the last few months continue to get weaker. This ties in with the current consumer attitude that has gotten a lot of more negative, particularly when it comes to making a long-term commitment, such as buying a home. The index has leveled off in recent months and analysts are hoping the market is at least stabilizing. Also over the last year home prices in most cities drifted lower, but the plunging collapse of prices seen in 2007-2009 appears to be behind us. Any chance for a sustained recovery will probably need a stronger economy. The report also pointed out that third quarter prices were down 1.2 percent from the previous quarter on a seasonally adjusted basis and were down 3.9 percent from the third quarter a year ago. Compared to a year ago, price declines in the 20 cities continued to improve in September and were down 3.6 percent after a year over year decline of 3.8 percent the month before.