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Case-Shiller Index: Home prices lowest in nine years

March 27, 2012

U.S. home prices fell for the fifth month in a row in January to the lowest level since early 2003, according to the S&P/Case-Shiller 20-city composite index.

The closely followed index dropped 0.8% in the first month of 2012. The three-month rolling index includes transactions that took place from November to January.

Over the past 12 months, prices have fallen 3.8% even though the U.S. economy has shown increasing signs of recovery. Sixteen of the 20 metropolitan areas posted declines, while only Miami, Phoenix and Washington, D.C., saw increases.

The federal government’s index for home prices was unchanged in January, but more recent data suggest prices might be stabilizing.

The large number of foreclosed homes, combined with a high
unemployment rate, has depressed the home market since a real-estate bubble burst in 2007. Many Americans, especially younger people, lack the financial means to buy a home despite ultra-low mortgage rates.

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