Charlotte home prices still struggle

Charlotte-area home prices ended last year at a new low for this downturn but with a smaller decline than the previous year, based on a closely watched index released today.

As of December, area prices had fallen 3.8 percent compared with December 2008, according to the S&P/Case-Shiller Home Price Index. That’s an improvement over 2008, when Charlotte prices first turned negative, and the market saw a 7.2 percent decline, but still below the national decline of 2.5 percent for last year.

Month to month, Charlotte posted four gains last year, in the spring and summer, when the national housing market also showed signs of strengthening. Since August, the area has shown declines every month, compared with the previous month.

“As measured by prices, the housing market is definitely in better shape than it was this time last year…,” said David Blitzer, chairman of S&P’s index committee. “However the rate of improvement seen during the summer of 2009 has not been sustained.”

Charlotte-area home sales have been trending up, compared with extremely low levels late in 2008. But prices, by other measures, also remain down.

Housing here and nationwide is expected to continue struggling, amid high unemployment, weak job growth and rising foreclosures. The April 30 expiration of two big tax credits also could stall sales again and lead to more price declines.

Case-Shiller is an index, like the stock markets, not an actual price. For Charlotte, the December index reading of just under 118, was about the same as the level in June 2005. The index tracks the price of repeat sales, so it’s an especially precise measure of how home values are holding up.

Case-Shiller tracks sales nationwide, but only reports specific results for 20 markets. Charlotte’s 3.8 percent decline last year put it in the middle, with nine markets showing gains or smaller losses. San Francisco was the leader, with a 4.8 percent gain. Las Vegas, one of the hardest hit, ended with a loss of 20.6 percent.

By Stella M. Hopkins
shopkins@charlotteobserver.com
Posted: Tuesday, Feb. 23, 2010