Home Prices Edge Down in Big Cities, Case-Shiller Says

(Los Angeles Times/MCT) -

Home prices fell slightly across large U.S. cities in December from a month earlier, further evidence that the housing market cooled to close the year, according to a closely watched index.

The S&P/Case-Shiller index of 20 large U.S. metropolitan areas, released Tuesday, declined 0.1 percent from November, the second straight month-over-month drop. Compared to a year earlier, the index rose 13.4 percent, a slower one-year pace than in November.

“The strongest part of the recovery in home values may be over,” David M. Blitzer, chairman of the index committee at S&P Dow Jones Indices, said in a statement.

Eleven cities saw slower one-year price increases in December compared with a month earlier. Los Angeles posted a strong rise of 20.3 percent from December 2012 to December 2013, but that was smaller than L.A.’s November-to-November gain.

Only six metro areas, including San Francisco and Las Vegas, saw prices rise in December from November.

The Case-Shiller index, created by economists Karl E. Case and Robert J. Shiller, is widely considered the most reliable read on home values.

The housing index compares the latest sales of detached houses with previous sales, and accounts for factors such as remodeling that might affect a house’s sale price over time.

The index, however, trails other indicators. More-recent data have revealed weakness in the market as would-be home buyers have struggled with high costs and too few homes available for sale.

In January, sales of previously owned homes dropped to the lowest level in 18 months, according to the National Association of Realtors.