Home prices were unchanged on average in July in a sign that the weak housing market could be stabilizing, a survey showed on Tuesday.
The S&P/Case Shiller composite index of single-family homes in 20 metropolitan areas was unchanged from a month earlier when adjusted for seasonal factors. Economists expected the seasonally-adjusted series to rise 0.1 percent.
Prices declined 4.1 percent from July 2010.
A weak jobs markets and a heavy load of household debt are helping keep Americans from buying homes despite historically low mortgage rates.
Economists expect the sector will remain weak for years to come but the long slide in house prices since 2008 could be in sight. The Case Shiller 20 cities index is down about 31 percent from its peak in 2006.
You are quite close to some equilibrium between supply and demand, said Cary Leahey, an economist at Decision Economics in New York.
The data was broadly in line with analysts expectations and does little to allay fears the United States could slip back into recession.
On an unadjusted basis, prices in the 20 cities rose 0.9 percent month on month, topping expectations for a 0.7 percent rise.
A government report on Monday showed new home sales slipped 2.3 percent in August to a six-month low, while prices also fell during the month.
The U.S. Federal Reserve last week unveiled new measures to ease credit further for home buyers, but analysts caution that the level of mortgage rates is not the main hurdle to buying.
Many economists are skeptical attempts to lower rates will help much because millions of Americas owe more on their mortgages than their homes are worth, which can effectively chain them to their properties while also preventing them from refinancing to lower their monthly costs.
Indeed, some analysts say the steadying of prices might just be the result of a slowdown in the pace of foreclosures.
This might just be a temporary stabilization. said Patrick Newport, an economist at IHS Global Insight in Lexington, Massachusetts.
(Writing by Jason Lange; Additional reporting by Richard Leong in New York; Editing by Chizu Nomiyama and Andrea Ricci)