WASHINGTON (3/26/14)--Cold weather, a limited housing supply and rising mortgage rates contributed to a third straight month of falling home prices in January, according to a report released Tuesday by Moody's (USNews.com, The Associated Press March 25).
The Standard and Poor's/Case-Shiller 20-city home price index dropped 0.1% in January, the same decrease seen over the prior two months.
But while home prices have flattened of late, economists say the market may have needed the break, as the last two years saw housing prices surge, which has priced many people out of the housing market.
This break, economists said, could set the stage for more predictable price conditions in the coming months.
"The housing market is showing signs of moving forward with more normal price increases," David Blitzer, chairman of the S&P Dow Jones index committee, told The Associated Press.
The housing recovery in general, meanwhile, may be stumbling alongside home prices, as existing home sales in February dropped to their lowest rate since mid-2012, and home construction fell for a third-straight month.
An uptick in new construction permits--fueled in large part by those looking to build multifamily housing or apartment complexes--sparks some confidence that conditions may still improve, however (News Now March 19).