RISMEDIA, September 30, 2009—(MCT)—The market value of U.S. homes in 20 major cities rose by 1.6% in July compared with June, the third monthly increase in a row, according to the Case-Shiller home price index recently released by Standard & Poor’s.
In July, prices rose in 18 of 20 cities. Only Seattle and Las Vegas recorded lower prices in July than in June. In the past year, prices are down 13.3% in the 20 cities. Prices are down 32.6% from the peak, and are now at levels seen in late 2003. Prices in all 20 cities were lower in July 2009 than in July 2008. The figures are not seasonally adjusted. Prices typically rise in the summer months when demand is stronger.
The figures indicate a “stabilization in national real estate values,” said David Blitzer of S&P, who cautioned that the expiration of the first-time home buyer tax credit and increased foreclosures could put more downward pressure on prices.
Falling home values had been a factor contributing to the global economy plunging into chaos because financial institutions made too many bad bets that U.S. home prices would never fall. Homeowners have lost trillions of dollars of wealth. Millions of homeowners have found themselves owing more on their house than it is worth. They cannot sell for what they owe, and they cannot refinance their home loans. Nor can they borrow against their home to finance their consumption. Rising unemployment is now driving foreclosures. Another wave of foreclosures from interest-payment only mortgages is anticipated.
The Case-Shiller 20-city index tracks repeat sales on the same properties over time, but it closely tracks only 20 cities, not the whole country. Following are, in descending order, the price changes in each of the 20 cities over the past year, based on the Case-Shiller data for July: Las Vegas, down 31.4%; Phoenix, down 28.5%; Detroit, down 24.6%; Miami, down 21.2%; Tampa, down 18.4%; San Francisco, down 17.9%; Minneapolis, down 17.3%; Seattle, down 15.3% Los Angeles, down 14.9%; Chicago, down 14.2%; Portland, down 13.9%; San Diego, down 12.3%; Atlanta, down 11.9%; New York, down 10.3%; Washington, down 9.8%; Charlotte, down 9%; Boston, down 4.9%; Denver, down 2.9%; Dallas, down 1.6%; and Cleveland, down 1.3%.
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