The Wall Street Journal
27 September 2011
U.S. home prices rose in July from a month earlier with a boost from seasonal demand, but were down from 2010 levels, according to the Standard & Poor’s Case-Shiller home-price indexes.
Separately, the mood among U.S. consumers remained low in September after plummeting in August, according to a report released Tuesday. Consumers are worried about their future incomes.
The housing market has been struggling to recover due to high unemployment, an abundance of foreclosures and tighter mortgage requirements. Home prices rose in April for the first time in eight months, though most of the improvement was believed to reflect the beginning of the spring-summer home-buying season.
“While we have now seen four consecutive months of generally increasing prices, we do know that we are still far from a sustained recovery,” said David Blitzer, chairman of S&P’s index committee. “Continued increases in home prices through the end of the year and better annual results must materialize before we can confirm a housing market recovery.”
Of the 20 major U.S. metropolitan markets, 17 reported higher prices from a month earlier, led by 3.8% growth in Detroit. Las Vegas and Phoenix saw declines of 0.2% and 0.1%, respectively. Denver was unchanged.
However, with the exception of Detroit and Washington, prices were down year-to-year.
The Case-Shiller index of 10 major metropolitan areas and the 20-city index both increased 0.9% in July from June. However, adjusted for seasonal factors, the sequential 10-city figure dropped 0.1% while the 20-city index was flat.
Year-to-year, unadjusted July prices fell 3.7% for the 10 major markets while the 20-city index was down 4.1%.
The National Association of Realtors last week reported that existing home sales in August rose 7.7% from July. Foreclosure sales and “short sales,” where lenders allow homeowners to sell houses for less than the value of existing loans and forgive the difference, accounted for 31% of sales.