WASHINGTON Home prices rose in August in half of major cities measured by a private survey, a sign that prices are stabilizing in some hard-hit portions of the country.
The Standard & Poors/Case-Shiller index showed Tuesday that prices increased in August from July in 10 of the 20 cities tracked. That marked the fifth straight month that at least half of the cities in the survey showed monthly gains.
The biggest price increases were in Washington, Chicago and Detroit. The greatest declines were in Atlanta and Los Angeles.
The August data provides a modest glimmer of hope that some areas may have bottomed out and could be turning around, said David M. Blitzer, chairman of S&Ps index committee.
He noted that cities in the Midwest Chicago, Detroit and Minneapolis have shown some strength since May.
In Detroit, the recovering auto industry has helped lead a small rebound in the housing market. Home prices have risen 2.7 percent since August 2010, making it one of only two cities to show a year-over-year gain in that time. The other was Washington.
In Minneapolis and Chicago, fewer homes are being put up for sale, leading to higher prices and better sales figures. Thats likely due to fewer foreclosures in those cities. Septembers drop in homes for sale in the Twin Cities was the largest decline in inventory in more than seven years, according to the Minneapolis Area Association of Realtors.
Still, Robert Shiller, the co-founder of the index and a Yale economics professor, said in an interview on CNBC that overall home prices were flat and a recovery in the struggling housing market was not on the horizon.
The index, which covers half of all U.S. homes, measures prices compared with those in January 2000 and creates a three-month moving average. The August data are the latest available nationally.
But more recent numbers are available for Middle Tennessee from the Greater Nashville Association of Realtors. In a nine-county swath in and nearby Nashville, Septembers single-family median home price dropped 5.1 percent from the same period last year, the second consecutive month that prices have ticked lower after rallying this summer. The median price of $163,000 was a drop of more than $8,800 year-over-year, the GNAR data found.More drops likely
Prices are certain to fall again once banks resume millions of foreclosures. They have been delayed because of a yearlong government investigation into mortgage lending practices.
We certainly believe the bulk of the decline in housing is behind us and indeed, one might even say that housing is more likely to improve from here, said Dan Greenhaus, chief global strategist for BTIG. But given the overwhelming level of inventory that remains on the market further price declines seem almost assured to help clear the market.