US home prices continue declining trend in January: Report

By Ovunc Kutlu

ISTANBUL (AA) - Home prices continued in January their declining trend, according to a report Tuesday by the S&P Dow Jones Indices (S&P DJI).

The S&P CoreLogic Case-Shiller index, which covers all nine US census divisions, posted an annual gain of 3.8%. The index, however, showed a slowdown from a 5.6% increase in December and a 7.6% gain in November.

"The 10-City Composite annual increase came in at 2.5%, down from 4.4% in the previous month. The 20-City Composite posted a 2.5% year-over-year gain, down from 4.6% in the previous month," said the report.

S&P DJI Managing Director Craig Lazzara said "2023 began as 2022 had ended, with US home prices falling for the seventh consecutive month."

"Financial news this month has been dominated by ructions in the commercial banking industry, as some institutions’ risk management functions proved unequal to the rising level of interest rates," he added.

Despite the turmoil in US banking sector, the Federal Reserve remains focused on reducing inflation, which suggest that interest rates may remain elevated in the near-term, according to Lazzara.

"Mortgage financing and the prospect of economic weakness are therefore likely to remain a headwind for housing prices for at least the next several months," he added.