NEW YORK (Reuters) - U.S. single-family home prices were unchanged in January, suggesting the battered housing market continues to crawl along the bottom, a closely watched survey said on Tuesday.
CARY LEAHEY, MANAGING DIRECTOR AND SENIOR ECONOMIST, DECISION ECONOMICS, NEW YORK
“The report is pretty good. Even though you got a decline in the year over year change of down 3.9 percent - which is pretty close to expectations - analysts tend now to look at the seasonally adjusted month to month changes and for the first time in months, you effectively had no change in prices from December to January. That breaks a string of significant declines over the last six months ago. This gives you a little more confidence that the housing market is bottoming because perhaps the most troubling aspect of the recent housing data has been the sagging of the Case-Shiller price index effectively since July 2011. The fact that the so-called double dip in home prices is ending gives you a little more confidence that the market could improve over the next year and half.”
PETER CARDILLO, CHIEF MARKET ECONOMIST ROCKWELL GLOBAL CAPITAL, NEW YORK
“It’s not going to make much difference in the market. The housing news that we have seen in the past week have been lower-than-expected but they still point to right direction. This may help Bernanke’s case, but the real market driver today would be consumer confidence. Better-than-expected consumer confidence will continue to support stocks, especially as we approach the end of the quarter.”
VIMOMBI NSHOM, ECONOMIST, IFR ECONOMICS, A UNIT OF THOMSON REUTERS
“The S&P/Case-Shiller HPI measured lower home values in January, as both the 20-city and 10-city HPIs fell by 0.8% (NSA) over the month, pulling their respective indices down to new lows, with the 20-city HPI down 3.8% yr/yr to 135.46 and the 10-city stands at 148.40 which is 3.9% lower than last January’s level. This is a slim improvement from December’s numbers when both indices fell by 4.1% yr/yr. January’s decline matches market expectations (-3.8% yr/yr) as most anticipated another month of substantial distressed properties putting downwards pressure on home prices. In addition to the composite headlines slipping to new annual lows, eight of the 19 MSA included in January’s report (Charlotte, NC was absent) also fell to their lowest levels. Compared to prices during the market’s peak (2006) home values in January were worth 34.4% less. Given that the housing market has to work through households dealing with depleted purchasing power and a large number of foreclosed and vacant properties pulling prices down, it would be safe to assume that home values will not recover all of that difference.”
Americas Economics and Markets Desk; +1-646 223-6300