Home Prices Keep on Falling; New Home Sales Rise

Washington, DC, May 27, 2008--Home prices fell in March by the most in at least seven years, according to the S&P/Case-Shiller home-price index.

Meanwhile, new-home sales rose in April but failed to meet expectations because the government revised lower the level of demand for the previous month.

The Case-Shiller index dropped 14.4 percent from a year earlier, more than forecast and the most since the figures were first published in 2001. The index has fallen every month since January 2007.

Prices dropped 2.2 percent in March from a month earlier, after a 2.6 percent decline in February, the report showed.

The index was forecast to drop 14 percent following a 12.7 percent drop in February, according to economists.

"The steep downturn in residential real estate continues," David M. Blitzer, chairman of S&P's index committee, said.

"There are very few silver linings that one can see in the data. Most of the nation appears to remain on a downward path."

New home sales in April rose 3.3 percent to an annual pace of 526,000 from March’s 509,000 rate, which was the lowest in 17 years, according to a Commerce Department report.

Economists were expecting a decline in sales to a 520,000 annual pace from an originally reported 526,000 in March.

Purchases in April were the second lowest since October 1991. The March reading became the weakest since April 1991.