S&P's Wyss says U.S. home prices to bottom in 2010

NEW YORK, Aug 5 (Reuters) - U.S. home price declines will likely hit bottom in 2010, Standard & Poor's Chief Economist David Wyss said in a report on Tuesday.

Even with major steps taken by the U.S. government and the financial markets to shore up the housing market, a chief concern for investors remains whether housing prices have hit bottom.

"As of now, an oversupply of houses and a steady number of new foreclosures are keeping home prices down," S&P said in a statement. "These trends have led us to continue revising our surveillance assumptions on rated" U.S. residential mortgage-backed securities (RMBS), the agency said.

Wyss said S&P is closely following the Treasury Department's push to get U.S. markets to embrace securities known as covered bonds and the growing popularity of re-REMICs, the process of resecuritizing parts of previously issued mortgage securities.

Covered bonds are secured by pools of assets like home loans. Their expanded use would challenge mortgage finance giants Fannie Mae and Freddie Mac.

"All of these initiatives may impact our estimate of loan performance in our rated transactions," S&P said. (Reporting by Walden Siew, Editing by Chizu Nomiyama)