U.S. Home-Price Index Falls 14 Percent

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Home prices in 20 U.S. metropolitan areas fell in March by the most in at least seven years, pointing to weakness in the housing market that will constrain economic growth, Bloomberg News reports.


The S & P;/Case-Shiller home-price index dropped 14.4 percent from a year earlier, more than forecast and the most since the figures were first published in 2001. The gauge has fallen every month since January 2007.


Prices continue to slide as record foreclosures put more homes on the market and stricter lending standards make it harder to get loans. Falling home values are slowing consumer spending, threatening to halt the six-year expansion.


“There is excess supply, weakening demand, prices are falling and will continue to fall,” said Kevin Logan, senior market economist at Dresdner Kleinwort in New York. “Housing sales are still trending lower.”


Prices dropped 2.2 percent in March from a month earlier, after a 2.6 percent decline in February, the report showed. The figures aren’t adjusted for seasonal effects, so economists prefer to focus on year-over-year changes instead of month-to- month variations.



New-Home Sales Rise


A government report showed new-home sales unexpectedly rose in April after readings for the prior month were revised down. Sales increased 3.3 percent to an annual pace of 526,000 from a 509,000 rate the prior month that was the lowest in 17 years, the Commerce Department said today in Washington.



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