By BW staff and the Associated Press
U.S. home prices fell in October for the 10th consecutive month, posting their largest monthly drop since 1991, a widely watched index showed on Dec. 26. The record 6.7% drop in the Standard & Poor's/Case-Shiller home price index also marked the 23rd consecutive month prices either grew more slowly or declined.
"No matter how you look at these data, it is obvious that the current state of the single-family housing market remains grim," said Robert Shiller, who helped create the index, in a news release.
The previous record decline was 6.3%, recorded in April, 1991. The S&P/Case-Shiller home price index tracks prices of existing single-family homes in 10 metropolitan areas compared to a year earlier.
A broader index of 20 metropolitan areas fell 6.1%. Among the 20 metropolitan areas used in the broader index, 11 posted record monthly declines and all 20 declined in October compared to September.
The news on the relatively stale October data shouldn't come as a huge surprise to the asset markets or the dollar, but suggests that the housing sector remains vulnerable heading toward 2008, says economic research outfit Action Economics.
Worst-performing City: Miami
Shares of homebuilders were trading mostly lower on Dec. 26. Toll Brothers (TOL) lost 0.3% to $21.11, KB Home (KBH) slipped 0.7% to $23.46, while Lennar (LEN) edged up 0.1% to $17.91.
Among the 20 metropolitan areas, Miami posted the largest decline. Home prices in the Miami metropolitan area fell 12.4% in October compared to the same month last year, surpassing Tampa, Fla., as the worst-performing city. Tampa posted a year-over-year loss of 11.8%.
Besides those two cities, Detroit, Las Vegas, Phoenix, and San Diego also posted double-digit year-over-year declines.
Atlanta and Dallas, which had previously posted price appreciation, fell in October. Prices fell 0.7% in Atlanta and 0.1% in Dallas compared to a year earlier.
Only three areas—Charlotte, N.C.; Portland, Ore.; and Seattle—posted year-over-year home price appreciation in October. Charlotte posted the largest gains at 4.3%.