US home prices fell in January from a month earlier, hitting new lows, with average home prices back to the levels they were at nearly a decade ago in early 2003, according to Standard & Poor's Case-Shiller home-price indexes.
Separately, U.S. consumers in March remain confident about the economy and labor markets generally, but a broader index dipped as inflation worries jumped this month, according to a report released Tuesday.
"Despite some positive economic signs, home prices continued to drop," said David Blitzer, chairman of S&P's index committee. The Case-Shiller index of 10 major metropolitan areas and the 20-city index now stand roughly 34% below their 2006 peaks, he said.
The U.S. housing market remained sluggish last year, despite some signs of stabilization mid-year. High unemployment rates, abundant foreclosures and tighter mortgage requirements have continued to weigh on the market.
Of the 20 major U.S. metropolitan markets, 16 reported prices were lower in January than during December. Miami, Phoenix and Washington, D.C., were the only areas to report growth month-to-month. Charlotte, N.C., wasn't included in the latest report because of data delays.
The Case-Shiller index of 10 major metropolitan areas and the 20-city index edged down 0.8% in January from a month earlier.
Year-to-year, unadjusted January prices declined 3.9% for the 10 major markets while the 20-city index dropped 3.8%. The latest year-to-year drop represented a marginal improvement over the 4.1% decline reported last year for both indexes. Just three cities reported annual growth. Denver home prices edged up 0.2%. Detroit and Phoenix--two cities that have seen massive price declines in recent years--reported year-to-year increases of 1.7% and 1.3%, respectively. Atlanta again posted the biggest drop--at nearly 15% year-to-year.
The National Association of Realtors recently reported that sales of previously owned homes dipped slightly in February as January figures were revised higher. Still, it was the strongest February reading in five years. The number of U.S. home buyers who signed contracts to purchase previously owned homes fell slightly last month, in a reminder that the housing recovery remains uneven. Though the number of homes for sale has been whittled down, the market also still faces a shadow inventory of millions of homes whose owners likely will put them on the market once conditions look more stable.
Consumer Confidence Dips
The Conference Board, a private research group, said its index of consumer confidence dropped to 70.2 in March after jumping more than 10 points in February to a revised 71.6, first reported as 70.8.
The latest index was close to the 70.0 expected by economists surveyed by Dow Jones Newswires.
The present situation index, a gauge of consumers' assessment of current economic conditions, rose to 51.0 from a revised 46.4 originally reported as 45.0. Consumer expectations for economic activity over the next six months fell to 83.0 from a revised 88.4 first put at 88.0.
"The present situation index now stands at its highest level in three and a half years, suggesting that despite this month's dip in confidence, consumers feel the economy is not losing momentum," said Lynn Franco, director of the Conference Board Consumer Research Center.
Views on labor markets seem to be driving the split in current and future economic assessments.
The board's survey showed 9.4% of respondents think jobs now are "plentiful," up from 7.0% thinking that in February, while 41.0% think jobs are "hard to get," up from 38.6% thinking that in February but below every other reading in the past year.
Consumers are more wary about the job situation over the next six months. The report shows 17.3% think there will be more jobs, down from 18.8% thinking that in February, while 18.3% think there will be fewer jobs, up from 16.4% in February.
Job growth as measured by the U.S. Labor Department has averaged 245,000 a month over the past three months.
Households are increasingly worried about future inflation. Consumers, on average, expect inflation to be 6.3% a year from now, up from 5.5% expected in February. It was the highest reading since May 2011, also a time of high gasoline prices.