NEW YORK — Residential real-estate prices dropped in the 12 months ending in December by the most in a year, a sign the U.S. housing market is struggling even as the rest of the economy recovers.
The Standard & Poor’s/Case-Shiller index of home values in 20 cities fell 2.4 percent, the biggest year-over-year decrease since December 2009, the group said Tuesday.
In the Denver area, home values fell 2.4 percent during the year.
There was a faint silver lining for Denver, which was one of six metropolitan areas that showed an improvement in annual growth rates from November to December.
In November, Denver-area home prices fell at an annualized rate of 1.2 percent, and that rate improved to a 0.7 percent decline in December.
A predicted increase in foreclosures this year as banks resume seizures may depress home values further, prompting would-be buyers to hold off on purchases.
“Home prices are still declining amid excess supply,” said Michelle Meyer, a senior economist at Bank of America Merrill Lynch Global Research. “Although transactions have started to pick up, buyers are looking for very low prices. There is a backlog of distressed properties, and it will flow into the market this year. We expect to see a gradual drop in prices.”
Nationally, including all markets, prices decreased 4.1 percent in the fourth quarter from the same time in 2009 and were down 3.9 percent from the previous three months, the biggest quarter-to-quarter drop in almost two years.
Denver Post staff writer Greg Griffin contributed to this report.
