Home prices suffered their worst annual decline in at least two decades with no sign that the trend is bottoming out, according to the S&P/Case-Shiller U.S. National Home Price Index released today.
The closely followed index of home values showed a 3.2 percent drop nationally for 20 metro areas, including a 1 percent drop in the Denver area, in the second quarter compared with a year ago.
The index tracks same-home resale values going back to 1987. The declines are more severe than those during the 1991 and 2001 recessions.
Another government-compiled index, which goes back to 1975, is scheduled for release Thursday. That index, while older, only includes same-home sales for properties purchased with loans backed by Fannie Mae or Freddie Mac.
“The pullback in the U.S. residential real-estate market is showing no signs of slowing down,” Robert Shiller, chief economist at MacroMarkets LLC, said in a statement.
Home prices dropped in 15 of 20 metro areas on a year-over-year basis. The biggest drop, 11 percent, came in Detroit, while values in Tampa Bay, Fla., fell 7.7 percent and San Diego home values were down 7.3 percent.
Gains in home values were strongest in Seattle and Charlotte, N.C.
A credit crunch in late July and August that has limited nontraditional and subprime loans is expected to only intensify the downward pressure on home prices.
A report Monday from the National Association of Realtors said sales of existing homes dropped for a fifth-straight month in July, while the number of unsold homes shot up to a record level.
Major U.S. stock indices traded lower by more than 1 percent today after the report came out.
Staff writer Aldo Svaldi can be reached at 303-954-1410 or asvaldi@denverpost.com.
