This morning's release of the Standard & Poor's Case/Shiller Indices proves extremely disappointing for those who are looking for evidence that home prices are nearing a bottom. Unfortunately, prices are still falling at an accelerating rate.
S&P tracks 20 major markets. The most recent data, which are for February, show that nineteen of those markets experienced year-over-year declines that were bigger than the declines seen in January. Prices fell more than 20% in Las Vegas, Phoenix, and Miami. In Las Vegas, prices are down 25% from their all-time high set in August 2006, yet because they remain 77% higher than they were in January 2000, they could go quite a ways lower. Charlotte was the only market to see a year-over-year gain in February. Prices in Charlotte inched up 1.48%, but even this was smaller than the increases in previous months.
Home prices will likely fall throughout 2008. Before they can stop falling entirely, their declines have to slow down. Because the S&P data are almost two months old, there is hope this may already be happening. Evidence of a slowdown in price decreases is the light at the end of the tunnel that will ultimately bring confidence back into the housing market.