January home prices decline here and in most cities
WASHINGTON — Home prices fell in January for a fifth straight month in most major U.S. cities, as modest sales increases have yet to boost prices.
The Standard & Poor’s/Case-Shiller home-price index released Tuesday showed that prices dropped in January from December in 16 of 19 cities tracked.
Home prices in the Seattle metropolitan area fell in January for the sixth straight month, according to the closely watched Standard & Poor’s Case-Shiller index, hitting yet another post-boom low.
The Seattle metropolitan area includes King, Snohomish and Pierce counties. January data, the most recent available, were released Tuesday.
The only silver lining for homeowners: the monthly rate of decline, 0.7 percent, was smaller than December’s 1.3 percent. Eleven of the 19 other cities that Case-Shiller tracks had steeper month-over-month price drops.
The steepest declines were in San Francisco, Atlanta and Portland. Prices increased in Miami, Phoenix and Washington. Price information for Charlotte was delayed and therefore not included in the report.
The declines partly reflect typical offseason sales. The month-over-month data are not adjusted for seasonal factors. The group’s nationwide index of prices has fallen 34 percent since the housing bust and is now at 2002 levels.
The continued drop in prices suggests the housing market remains weak, even after the best winter for home sales in five years and steady improvement in the job market.
“Despite some positive economic signs, home prices continued to drop,” said David M. Blitzer, chairman of S&P’s index committee.
Eight cities – Atlanta, Chicago, Cleveland, Las Vegas, New York, Portland, Seattle and Tampa, Fla. – are now back at 2000 levels or earlier. Only Denver, Detroit and Phoenix posted year-over-year increases.
Analysts were quick to note that prices are expected to rise modestly throughout much of 2012.
“It’s going to be tempting to look at home price declines and see a still-faltering housing recovery, but that’s just not the case,” said Stan Humphries, chief economist for housing website Zillow.com
“The reality is that home prices and home sales will be moving” higher. The Case-Shiller monthly index covers half of all U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average.
Some economists say sales increases could stop prices from falling further by early spring. Home prices tend to follow sales by about six months. When sales rise, prices rise, too, and an increase in prices would likely create a positive cycle. Homes are the most affordable they’ve been in decades. And mortgage rates are just above record lows.
The biggest reason why prices are still falling is foreclosures, which are still high across the country. Foreclosures and short sales – when a lender accepts less for a home than what is owed on a mortgage – are selling at an average discount of 20 percent.
The Seattle Times contributed to this report.
Good news, bad news in Tacoma-area foreclosures
There’s mixed news on the mortgage front for the Tacoma area.
Foreclosure rates were down in January from January last year, but nearly one in 10 Tacoma-area homeowners is 90 days or more behind in their mortgage payments.
That’s the news from CoreLogic, a real estate tracking company.
The foreclosure rate of Tacoma-area homes was 2.09 percent in January this year, down from 3.12 percent in the same month a year ago. That rate is better than the national average, which is 3.43 percent but worse than the statewide average which is 1.43 percent.
Foreclosures peaked in Tacoma last July when the rate hit 3.28 percent. Since then, the rate declined steadily through December when the rate was 2.06 percent. That bumped upward again in January, when the rate was 0.03 percentage points greater.
Mortgages 90 or more days delinquent, however, have risen fairly steadily in the Tacoma area, hitting 9.26 percent in January, up from 9.14 percent in December and 8.62 percent in January 2011. That delinquency rate compares with a national rate of 7.24 percent.
John Gillie, staff writer