S&P/Case-Shiller home prices rose for first time in 8 months in April
The average price of a single-family home rose for the first time in eight months in April and is now back at levels last seen in the summer of 2003, according to the Standard & Poor's/Case-Shiller index. The S&P/Case-Shiller 10-city composite index increased 0.8% in April from the prior month and the 20-city index inched up 0.7%. Both indices remain lower than a year ago, with the 10-city down 3.1% and the 20-city composite 4% lower than April 2010. "In a welcome shift from recent months, this month is better than last — April's numbers beat March," according to David Blitzer, chairman of the index committee. "However, the seasonally adjusted numbers show that much of the improvement reflects the beginning of the spring-summer home buying season. It is much too early to tell if this is a turning point or simply due to some warmer weather." After peaking in the summer of 2006, the S&P/Case-Shiller home prices indices are down 32.6% for the 10-city and 32.8% for the broader composite through April. From the trough seen in April 2009, the 10-city index is up 1.4% and the 20-city is up a scant 0.7%, according to S&P. Lower priced homes sold less well than the middle and higher priced homes in April, Blitzer said on CNBC Tuesday morning. He said the seasonally adjusted numbers indicate some of the monthly increase is attributable "to the season, but not all of it." "Other housing statistics show the same trends," Blitzer said. "Single-family housing starts were up in May, but still well below their 2010 levels and still very close to their 30-year low. Existing home sales rose in May, but are still about 15% below last year’s pace and about 35% below their 2005 pace." He said foreclosures continue to dominate the market in many areas of the country, yet the pace of defaults has cooled since November. Blitzer also said tightened lending standards hinder home sales as mortgages are harder to get despite historically low interest rates. For the first quarter, the S&P/Case-Shiller fell 4.2% after after declining 3.6% in the final three months of 2010. The first-quarter drop was the most acute since prices began falling several years ago. In April, home prices in 19 of the 20 metropolitan areas tracked are down from a year earlier, with only Washington show gains at 4% growth. S&P said home prices in 13 markets increased in April from March, yet 16 markets "saw their annual rates of change fall deeper into negative territory." Write to Jason Philyaw.