A gauge of home prices in 20 large U.S. cities is likely to dip in August, reversing four straight months of gains, as the weak economy caused buyers to shy away from purchasing homes.
The Standard & Poor's Case-Shiller index of home prices in 20 major U.S. cities is likely to dip about 0.6 percent in August from a month earlier, forecasts Quinn Eddins, director of research at Radar Logic Inc., which tracks the housing market.
Though the report looks at prices in 20 cities, the trends vary. Prices are setting new lows in foreclosure-plagued Las Vegas, which is down 57 percent from the peak in August 2008. By contrast, San Francisco's prices are down only 5.4 percent in that same time period.
While prices rose from April through July, those increases were fueled by now-expired homebuyer tax credits. Now that the peak buying season is over, a record number of foreclosures, job concerns and weak demand from buyers are pushing prices down.
In housing markets that have been devastated by the housing bust, revelations about flawed foreclosure paperwork mess are causing buyers to be wary of purchasing homes in foreclosure. Some would-be buyers are worried the sale will be canceled or complicated if the previous owners claim in court that their foreclosure was invalid.