U.S. single-family home prices fell more than expected in November, highlighting a sector that continues to struggle to make a meaningful recovery, a closely watched survey showed on Tuesday.
The S&P/Case-Shiller composite index of 20 metropolitan areas declined 0.7 percent on a seasonally adjusted basis, a bigger drop than the 0.5 percent economists had expected.
The decrease added on to the 0.7 percent decline seen in October. The new data suggest the home price index has “taken a turn for the worse,” Ellen Zentner, an economist at Nomura, said in a research note.
Home prices continue to decline “despite continued low interest rates and better real GDP growth in the fourth quarter,” said David Blitzer, chairman of the index committee at Standard & Poor’s. “The trend is down and there are few, if any, signs in the numbers that a turning point is close at hand.”
While there had been some improvement in the foreclosure picture there are still some foreclosures out there, Blitzer told CNBC, noting that the number of foreclosures may be accelerating. There are some encouraging signs out there when it comes to home prices, but home prices will be “the last thing to turn,” he said. First, supply has to tighten and loan availability needs to improve, Blitzer added.
Prices in the 20 cities also steepened their year over year decline, falling 3.7 percent compared to a 3.4 percent decline the previous month.