Home prices show renewed pressure: S&P
Single-family home prices were unchanged in March from February, but fell in the first quarter on renewed price pressure as federal aid faded away, Standard & Poor's/Case Shiller home price indexes showed on Tuesday.
Prices have rebounded from lows hit during the crisis, yet the end of tax incentives for homebuyers combined with mounting foreclosures suggests more weakness, S&P said.
The S&P composite index of 20 metropolitan areas was unchanged in March from February on a seasonally adjusted basis, better than the 0.3 percent decline forecast in a Reuters survey.
On an unadjusted basis, prices fell 0.5 percent in March after a 0.9 percent February drop, worse than the estimated 0.4 percent decline.
For the first three months of the year, the national home price index fell 3.2 percent, unadjusted, compared with a 1 percent drop in the fourth quarter. The index was up 2 percent, however, from the same quarter a year ago.
The 20-city index posted a 2.3 percent annual increase in March, near the 2.4 percent forecast.
Despite improvement on a year-over-year basis, David M. Blitzer, Chairman of the Index Committee at S&P, said the March monthly report was not encouraging.
It is especially disappointing that the improvement we saw in sales and starts in March did not find its way to home prices, he said in a statement. Now that the tax incentive ended on April 30, we don't expect to see a boost in relative demand.
Buyers had to sign contracts by April 30 to get federal tax credits of up to $8,000.
(Editing by Chizu Nomiyama)
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