Tuesday, June 30, 2009

Home Prices are "Less Worse"

Bloomberg reports:

Home prices in 20 major U.S. metropolitan areas fell in April at a slower pace than forecast, a sign the plunge in real-estate values is abating.

The S&P/Case-Shiller home-price index decreased 18.1 percent from a year earlier following an 18.7 percent drop in March. The measure declined 19 percent in January, the most since the data began in 2001.

Price declines are likely to keep moderating as demand steadies and distressed properties account for a smaller share of transactions. Still, the highest jobless rate in 25 years is contributing to record foreclosures, which are likely to keep depressing values for months to come even as home sales steady.

Below is a chart of the second derivative in year over year change (i.e. April year over year change less March year over year change).

It looks like some of the worst hit markets are beginning to bottom (California and Florida to be more specific).

Source: S&P