Home Prices Dip in September

Home prices across the nation fell in September, after posting gains during the spring and summer, according to the latest reading of the Standard & Poor’s/Case-Shiller index.

Prices fell 0.6 percent from September to October, and 3.6 percent from the previous year. Out of the 20 cities tracked by the index, prices dipped in 17, breaking the five month streak where at least half of the cities showed monthly increases.

“The plunging collapse of prices seen in 2007 to 2009 seems to be behind us,” says David Blitzer, chairman of the S&P index committee, as quoted in a USA Today article.  But that doesn’t mean price declines are a thing of the past.  ”Any chance for a sustained recovery will probably need a stronger economy,” he added.

Prices dropped most dramatically in Atlanta, San Francisco, and Tampa. In Atlanta, for example, prices fell almost 6 percent in September, and are down 10 percent compared to one year ago.

The only cities to show price gains were New York, Portland and Washington D.C.

There is a good chance home prices could continue to fall, as mortgage lenders have started processing foreclosures at full steam again after pausing to clean up the robo-signing documentation mess. Plus, the latest data from data analysis company CoreLogic shows that there are 10.7 million U.S. homeowners who are upside down on their mortgage, and another 2.4 million who are close to falling underwater.  As all of these foreclosed houses continue to flood the market, prices will be pushed down as homeowners are forced to compete with the deeply discounted distressed properties.

Without serious improvements in employment rate, which has hovered around 9 percent for most of the year, there will not be enough economic strength to support a housing recovery. So we can hope the latest numbers are not too ominous, but the reality is that we may be stuck in this mortgage quagmire for at least another a year.

2 Responses to “Home Prices Dip in September”

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