US house prices remain on hold in August: Case-Shiller

US home prices remained flat in the in August, edging just 0.2% higher but still down by 3.8% on an annual basis, according to the latest S&P/Case-Shiller composite index.

The index mirrored another monthly index, the Federal Housing Finance Agency, which noted home prices slipped 0.1% on a seasonally adjusted basis, and 4% over the previous year.

Economists say there is too much inventory, particularly of distressed properties, compared with the pace of home purchasing, which meant prices could fall or linger further to equilibrate the market.

The Case-Shiller index had Detroit and Washington as the only cities to post August and annual growth.

The US Midwest – Chicago, Detroit and Minneapolis—showed sharp monthly increases, with economists noted in the Wall Street Journal attributing it to hiring in the automotive sector. Click to enlarge

Ten of the 20 cities covered by the indices had prices increase over the month.

There was no change in annual returns in Los Angeles and Miami in August.

The rate of change fell deeper into negative territory in Atlanta and Las Vegas.

Minneapolis posted the lowest year-over-year return at a negative 8.5%, but has improved in each of the last three months.

“There was some weakness in the monthly statistics, as 10 of the cities post price declines in August over July,” says David M. Blitzer, chairman of the index committee at S&P Indices.

“Nationally, home prices are still below where they were a year ago.”