March 27 (Bloomberg) -- U.S. home prices fell in January for the first time in at least six years, a private report showed today.

A measure of home values in 20 metropolitan areas dropped 0.2 percent from the same month last year, according to the S&P/Case-Shiller home-price index. The decrease was the first since the group started keeping year-over-year records in January 2001.

The numbers follow a report yesterday that showed new-home sales at the lowest level in almost seven years as builders struggled with a glut of unsold dwellings. Falling prices make it harder for owners to borrow against home equity and may make lenders even more wary as delinquencies climb.

Today's data ``are a good indicator of the dire state of the U.S. residential real estate market,'' said Robert Shiller, chief economist at MacroMarkets LLC and a professor at Yale University.

Lennar Corp., the largest U.S. homebuilder by revenue, said today that earnings plunged 73 percent in the fiscal first quarter. The Miami-based company also said that it will likely miss its 2007 profit forecast.

``The housing market continues to demonstrate overall weakness,'' Chief Executive Stuart Miller said in a statement. ``While some markets are performing better than others, the typically stronger spring selling season has not yet materialized. These soft market conditions have been exacerbated by the well-publicized problems in the subprime lending market.''

Mortgage Foreclosures

Mortgage foreclosure filings last month jumped 12 percent from a year earlier as owners struggled with declining home values and higher adjustable-rate loans, according to a report yesterday from RealtyTrac, an online listing of foreclosed properties.

Home prices fell 0.6 percent in January from a month earlier, the sixth straight decline, today's report showed. The figures aren't seasonally adjusted, so economists prefer to focus on the year-over-year change.

The index is a composite of transactions in 20 metropolitan areas. Eleven cities showed a year-over-year decline in prices, led by a 6.9 percent slump in Detroit and a 5.6 percent decrease in Boston. Eight showed an increase from a year earlier.

Of the 20 areas covered, 17 showed declining home prices compared with December, and only one, Charlotte, North Carolina, showed an increase.

`Good Chance of Bigger Drops'

``There's a good chance we'll see bigger drops,'' Shiller said in an interview from Boston. ``The psychology is changing.''

The S&P/Case-Shiller index covering 10 cities fell 0.7 percent in January from a year earlier.

The National Association of Realtors said last week that the median price of an existing home in February fell 1.3 percent from a year earlier, to $212,800. It was the seventh consecutive decline.

Commerce Department figures yesterday showed the median price of a new home dropped 0.3 percent in February to $250,000 from $250,800 a year earlier.

The S&P/Case-Shiller index and another by the Office of Federal Housing Enterprise Oversight track the same home over time and more accurately reflect price trends, economists said.

The home-price measure was created by Shiller and Karl Case, an economics professor at Wellesley College, and is based on their research in the 1980s. Housing has undergone the biggest speculative boom in U.S. history, Shiller said in the second edition of his 2000 book, ``Irrational Exuberance,'' which predicted the stock market would collapse.

The gauges from the Commerce Department and the Realtors group can be influenced by changes in the types of homes sold. Higher sales of cheaper homes relative to more-expensive properties will bias the figures down.

To contact the reporter on this story: Shobhana Chandra in Washington at schandra1@bloomberg.net

Last Updated: March 27, 2007 13:25 EDT