U.S. Housing Prices Fell Again in January

The Standard Poor’s Case-Shiller Home Price Index for 20 large cities dropped 1 percent from December, putting it only 1.1 percent above its spring 2009 low. The index is down 31.8 percent from its 2006 peak.

Analysts expected a rough winter, but not quite so brutal.

“We are more negative on housing than we were three months ago,” said Jennifer Lee of BMO Capital Markets. Any recovery will be delayed until next year, she said.

Maureen Maitland, S. P.’s vice president for index services, noted that sales of both new and existing homes were weak, compounding the market’s struggles. “We can’t see a bottom for housing,” she said.

Atlanta, Cleveland, Detroit and Las Vegas are now below their average prices of 11 years ago, and Phoenix is almost there. Charlotte, Chicago, Dallas and Minneapolis are not doing much better.

Buying a house is a mix of faith and necessity, but the first element is scarce these days. The Conference Board reported Tuesday that its consumer confidence index tumbled 8.6 percent in March, the first drop in six months and the largest in a year.

Among the troubles facing the market is a pervasive sense that houses are a bad bet at the moment. If prices still have further to fall, if loans are tough to get, if interest rates are no longer plunging, why not put off a deal if you can?

First-time buyers, a critical force in the market, have become scarcer since a stimulus program involving tax credits came to an end last spring.

“That really motivated a lot of people to act,” said Steven Thoele, a broker with Keller Williams in Portland, Ore. “Eight grand in your pocket went a long way to making the numbers work”

Portland was one of 11 cities in the Case-Shiller index that reached another low for the current downturn in January. Prices fell 1.8 percent from December, pushing them back to 2005 levels.

“You do kind of wonder where the bottom is,” said Mr. Thoele. “Sellers know in the back of their mind that their home is worth less than at the peak, but they’re still a little surprised when you tell them their $400,000 house is now worth $300,000.”

Case-Shiller is a three-month moving average, which means it is resistant to quick changes. On a seasonally adjusted basis, January’s drop was 0.2 percent, the same as in December. In the slower winter months, the adjusted numbers are considered less indicative of the market’s true condition.

Prices were down 3.1 percent from their levels a year earlier. Only two of the 20 cities in the index recorded price increases during that time: Washington and, barely, San Diego.

The report capped a run of weak housing reports. Existing-home sales were down in February by nearly 10 percent from January, the National Association of Realtors reported last week, much worse than expected.

New-home sales in February were 14 percent below forecasts. At an annual rate of 250,000, sales were the lowest since the advent of record-keeping in 1963.

In one hopeful note, the National Association of Realtors said this week that pending home sales rose 2.1 percent in February. Those deals, which will become final in March and April, indicate that sales are unlikely to continue to tumble, which could help stabilize prices.

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