RTTNews - While home prices continued to show a negative annual rate of return in the month of June, Standard and Poor's released a report on Tuesday showing that the pace of decline slowed by more than economists had been expecting.
The report showed that the S&P/Case-Shiller 20-City Composite Home Price Index fell at an annual rate of 15.4 percent in June compared to a revised 17 percent drop in May. Economists had expected prices to fall 16.4 percent compared to the same month a year ago.
With the annual rate of decline slowing for the second consecutive month, the report showed that the S&P/Case-Shiller U.S. National Home Price Index fell at an annual rate of 14.9 percent in the second quarter compared to the record 19.1 percent decline reported for the first quarter.
On a sequential basis, the S&P/Case-Shiller U.S. National Home Price Index was up 2.9 percent in the second quarter compared to the previous quarter.
David M. Blitzer, Chairman of the Index Committee at Standard & Poor's said, This is the first time we have seen a positive quarter-over-quarter print in three years.
The report also showed that both the 10-City and 20-City Composite Indexes posted monthly increases, with both increasing by 1.4 percent in June compared to May. This marked the second consecutive monthly increase by both indexes, which both edged up 0.5 percent in May.
As seen in both seasonally adjusted and unadjusted data, as well as the charts, there are hints of an upward turn from a bottom, Blitzer said. However, some of the hardest hit cities, especially in the Sun Belt, show continued weakness.
The report said that 18 of the 20 metro areas saw improvement in their annual returns in June, although 15 out of the 20 metro areas continued to report double-digit annual declines.
Home prices in Cleveland showed notable improvement in May and June and were down only 3.0 percent year-over-year. Dallas and Denver also showed only modest annual rates of declines.
Meanwhile, Las Vegas and Detroit continued to struggle and were the only two markets that saw prices fall on a monthly basis in June. Since their relative peaks, prices in Las Vegas and Detroit have fallen 54.3 percent and 45.3 percent, respectively.
Commenting on the data, Peter Boockvar, equity strategist for Miller Tabak said, The question looking out the next few quarters is what the influence will be from a catch up in home prices to the downside in the prime area and the end to foreclosure moratoriums at many banks.
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