The S and P Case Shiller indexes for home prices have shown small gains. The price indexes in February showed a rise in home prices in contrast to the previous February, showing a modest spike, but the prices were still technically modestly declining. Though the housing market is not fully recovered, it is believed to be showing signs of improvement. Prices are nevertheless declining, and some individuals are underwater and unable to get mortgage loan modification.
First gain given that 2006 reported by Case Shiller
MarketWatch reports home prices posted their first gain given that December 2006. February home prices posted a .6% gain over the previous February. The inspiration is given as the homebuyer tax credit. The prices aren’t low enough to purchase a home with a small loan, however they are low enough to stimulate some into purchasing.
But there is also bad news
Home prices are still actually declining. The exact same study indicated that despite the increase in home prices between February present and past, home prices actually are nevertheless declining. January to February was really a .9% drop. CNN Money reports that 18 of the 20 Case Shiller indexes for large cities saw declines.
We are not out of the woods yet for economic recovery
David Blitzer, chairmen of the S and P index committee said the data might “point to a risk that home prices could decline further before experiencing any sustained gains.” He also said the housing market hadn’t truly begun to recover, despite modest improvements. There are greater numbers of home sales, but still at lower prices. (Prices will eventually climb if more individuals are buying.)
So what next?
The S and P Case Shiller index of home prices is about where it was in fall of 2003. The high point was June of 2006, and since June of 2006, home prices have fallen 32.6 percent. True recovery may take a long time.
Resources
MarketWatch
http://www.marketwatch.com/story/home-prices-show-year-over-year-gain-sp-2010-04-27?reflink=MW_news_stmp
CNN Money
http://money.cnn.com/2010/04/27/real_estate/home_prices_up/index.htm
