Home prices drop nationally, but Raleigh sees slight increase

Posted May 27, 2008 9:29 a.m. EDT
Updated May 27, 2008 9:55 p.m. EDT

— U.S. home prices dropped at the sharpest rate in two decades during the first quarter, a closely watched index showed Tuesday, a somber indication that the housing slump continues to deepen.

Standard & Poor's/Case-Shiller's said its national home price index fell 14.1 percent in the first quarter compared with a year earlier, the lowest since its inception in 1988. The quarterly index covers all nine U.S. Census divisions.

Its 20-city index tumbled 14.4 percent during the quarter, the lowest since that index was started in 2001.

Nineteen of the 20 metro areas in the survey reported annual declines. Las Vegas had the worst quarterly performance, falling 25.9 percent, followed by Miami and Phoenix.

Only Charlotte reported an increase – 1 percent over the previous year.

Raleigh-Durham is not included in the survey, but according to the Triangle Realtors Association, home prices in the first quarter also increased 1 percent from last year.

In April, however, the average home price dropped by 1 percent from the year before – a sign the area might start to feel downward pressure.

Stacey Horowitz, a realtor with Fonville Morisey, says because of the growing population, the local housing market is still one of the most stable in the country

"It's just a little slower," she said. "It's taking a little longer to sell homes."

According to S&P/ Case-Shiller, Raleigh is expected to stay flat for the rest of the year.

"There are very few silver linings that one can see in the data. Most of the nation appears to remain on a downward path," said David Blitzer, chairman of S&P's index committee.

The metros covered were: Phoenix, Los Angeles, San Diego, San Francisco, Denver, Washington D.C., Miami, Tampa, Atlanta, Chicago, Boston, Detroit, Minneapolis, Charlotte, Las Vegas, New York, Cleveland, Portland, Dallas and Seattle.