Battered home values in 20 of America’s biggest metropolitan areas fell even farther in November, according to a widely watched measure of housing prices released Tuesday.
Home prices in November dropped 18.2 percent from a year earlier, not quite as bad as economists had expected, according to the Standard & Poor’s Case-Shiller Home Price Index. Prices in 11 of the 20 metropolitan areas surveyed fell at record rates, and 14 areas reported double-digit declines from November 2007.
The 20-city index for November fell to 154.59, its lowest point since January 2004.
“The disappointing news is that the declines are still accelerating,” said Adam York, an economic analyst at Wachovia. “It emphasizes just how much stress the housing market is under.”
The problems were most pronounced in parts of the country like southern California, south Florida and the Southwest, where prices of houses and land once doubled, or even tripled, in a single year, and developers rushed to lay out quilts of new subdivisions and build condos.
In the Phoenix metro area, home prices fell 32.9 percent in November from a year earlier, and they tumbled 31.6 percent in Las Vegas. In the San Francisco metropolitan area, prices declined 30.8 percent from last year.
Not one of the 20 cities in the index posted a gain in prices from October to November, or from last November to this year. But Denver and Dallas fared the best, with home prices in Dallas falling 3.3 percent from last year, and 4.3 percent in Denver.
David M. Blitzer, chairman of the index committee at Standard & Poor’s, said he was heartened to see that, after months of worse-than-expected declines in housing statistics, the real data weren’t drastically worse than the expectations.
Still Americans are not getting any more optimistic as the yearlong recession digs in. The private Conference Board reported that consumer confidence continued to fall in January, hitting a new low of 37.7. Only 6.4 percent of 5,000 households surveyed reported that business conditions were good.
For millions of Americans, a drop in gasoline and energy prices has been the only glint of positive economic news over the last six months. Unemployment has risen to 7.2 percent and could top 9 percent in the next year; employers are trimming work weeks and laying off workers by the thousands; and people’s retirement accounts have been devastated by the turmoil in the financial markets.
The continuing erosion of housing values poses a threat to millions of Americans who overreached to take on big mortgages or home equity loans, gambling that ever-rising home prices would keep them above water.
But tumbling values because of foreclosure sales and forced sales have also prompted a mini-boom in some parts of the country, where rock-bottom prices have lured buyers back into the market. The National Association of Realtors reported Monday that existing-home sales rose 6.5 percent in December, the largest monthly bounce in years.
“It’s the beginning of what I think will be a regular drumbeat of reports of pickup of home sales,” said Kenneth Simonson, chief economist of the Associated General Contractors of America. “I’m at the optimistic end of the spectrum. I think home sales will pick up throughout the first half of this year, and by the second half, we’ll see homebuilders pick up their tools in selected markets.”
Housing inventories at the end of December fell 11.7 percent from a month earlier, to 3.68 million homes, down from 4.2 million unsold homes in November.
