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20-City Home Price Index Fall 1.3 Percent

US home prices fell for a third straight month in November as foreclosures continue to weigh on the market, dragging down overall home values as sellers and builders are forced to compete with a never ending wave of steeply discounted distressed properties. Of the 20 cities tracked by the Standard & Poor's / Case-Shiller home price index, only Phoenix showed a year-over-year increase in prices, and the overall index slumped 1.3 percent from October and 3.7 percent from the previous November.

Analysts point out that home prices typically fall in the winter because most Americans prefer to hunt for houses and move in the spring or summer, but three straight months of declines indicate that weakness is likely to continue into the new year, possibly pushing the downturn for the US housing sector into a sixth year. Karl Case, co-creator of the index, said that the housing market could be approaching what he referred to as a "rocky bottom," meaning huge declines seen over the last few years may be over, but any improvement will come sporadically.

According to the Case-Shiller index, home prices have now fallen nearly 33 percent from their 2006 peak levels all the way back down to mid-2003 levels. Atlanta continues to be one of the worst-hit cities in the country, as prices fell 2.5 percent in November after falling 5 percent in October and 5.9 percent in September. In addition, Atlanta hit a new all-time low in home values in November, as did Seattle, Las Vegas and Tampa, Florida.

January 31, 2012