-- Big-city home prices in July were down 16.3% from a year earlier, but the decline in prices appears to be slowing.
The Standard & Poor's/Case-Shiller 20-city housing index released Tuesday showed the largest 12-month decline since it began in 2000. Home values in all 20 cities fell year-over-year. Las Vegas and Phoenix reported year-over-year declines of nearly 30%. Miami reported a decline of 28.2% from July 2007.
Since the peak of the housing market in mid-2006, the 20-city price index has fallen 19.5%, according to Standard & Poor's.
The new report shows a slowing pace of declines that may hint at stabilization in some markets: During the May-July period, home prices fell about 2.2%. That's far less than February through April, when prices declined by more than 6%.
Atlanta, Boston, Dallas, Denver and Minneapolis all reported price increases during the May-July period.
"That's positive and reflects that we saw a surge in foreclosure sales in the beginning of the year," says Mark Zandi, chief economist at Moody's Economy.com. As more of those homes move off the market, the rate of price declines is slowing, he says. About 20% of the market is foreclosure sales, he says.
Lawrence Yun, chief economist at the National Association of Realtors, said the slowing pace of price declines may indicate some stabilization in the market. "Pockets of the country have turned around," says Yun.
Economists have been searching for signs that the steep drop in housing prices over the last two years is slowing. Price declines are leaving more homeowners owing more for their properties than they could sell them for.
"It's a problem because people had been using homes for a source of funding through home equity. Now they can't do that," says Joel Naroff of Naroff Economic Advisors. "Their spending is going to go down."
The Case-Shiller index follows other recent reports showing the housing slump has yet to turn around.
The National Association of Realtors said last week that the median sales price of an existing home in August was $203,100, down 9.5% from a year earlier. That was the largest 12-month decline since 1999.
The median price of a new home fell to $221,900 in August, down 5.5% from a year earlier, the Commerce Department also said last week.
Also last week, the Office of Federal Housing Enterprise Oversight reported a 5.3% decline in home prices nationally during the 12 months ended in July. OFHEO bases its calculation on home sales in which government-chartered investors Fannie Mae or Freddie Mac were involved.