After rising in the second quarter, a quarterly index of national home prices fell in the third quarter, according to the latest Standard & Poor’s/Case-Shiller National Home Price Indices report, released today.

The indices, which are based on repeat sales of single-family homes over time, have a base value of 100, with levels above 100 representing the percentage of home-value appreciation since January 2000.

The U.S National Home Price Index fell 1.5 percent year-over-year and 2 percent month-to-month in the third quarter, to 135.48. This comes after both year-over-year and quarter-to-quarter increases in the second quarter, partially driven by an April 30 federal homebuyer tax credit program deadline.

Both the monthly 20-city and 10-city composite indices increased slightly in September compared to the same month a year ago — 0.6 percent and 1.6 percent, respectively — but for the fourth straight month annual growth rates were smaller compared to the previous month.

Both indices fell compared to August: -0.5 percent and -0.7 percent, respectively. Fifteen of 20 metro areas studied saw year-over-year index declines — all except Boston, Los Angeles, San Diego, San Francisco, and Washington, D.C. San Francisco saw the most improvement: up 5.5 percent. Chicago saw the biggest decline: -5.6 percent.

All but two metros — Las Vegas and Washington, D.C. — experienced month-to-month drops. Cleveland saw the biggest decrease, falling 3 percent. Las Vegas and Washington, D.C., rose 0.1 percent and 0.3 percent, respectively.

David M. Blitzer, chairman of the Index Committee at Standard & Poor’s, called the report "weak" and warned of a double dip in home prices.

"Other than Tampa, Fla., there are no new lows this month, but many analysts will argue that a double dip will be confirmed before spring. While some of the bad numbers may reflect the end of the government’s tax incentive for first-time homebuyers, there are other problems weighing on the housing market," Blitzer said in a statement.

"The national economy is certainly the No. 1 issue for housing. Additionally, there is a large supply of houses on the market and further, hidden supply due to delinquent mortgages, pending foreclosures or vacant homes. New construction is running at less than half the pace needed to meet normal demand, so a sustained recovery could be a ways off."

Since its trough in the first quarter of 2009, the national home-price index has risen 4.9 percent, the report said. From their peak in June and July 2006, through September 2010, the 10-city and 20-city composites have fallen 28.7 and 28.6 percent, respectively.

A national home-price index released separately by Freddie Mac also fell in the third quarter. The Conventional Mortgage Home Price Index — which tracks resales of homes with mortgages owned or guaranteed by Freddie Mac or Fannie Mae — declined 3.1 percent compared to the third quarter of 2009. The index fell 1.9 percent from the second quarter on a non-seasonally adjusted basis, the report said.

Because it doesn’t include mortgages too large or too risky for Fannie and Freddie, the index can understate price volatility.

Amy Crews Cutts, Freddie Mac’s deputy chief economist, attributed the decrease to the expiration of the tax credits and to the prevalence of distressed properties in the market.

"Our forecast is for economic conditions to continue to improve, which should lower delinquency rates further over the coming year and relieve some of the downward pressure on home prices," Cutts said, in a statement.

Of the nine U.S. Census divisions, the only one to see even a slight year-over-year price gain was the West South Central Division (Arkansas, Louisiana, Oklahoma and Texas), up 0.2 percent.

Every other division saw prices fall year-over-year with the Mountain Division (Arizona, Colorado, Idaho, Montana, New Mexico, Nevada, Utah and Wyoming) seeing the biggest drop: -8.3 percent, followed by the South Atlantic Division (Delaware, Florida, Georgia, Maryland, North Carolina, South Carolina, Virginia, West Virginia, and Washington, D.C.) at -6.3 percent; the East North Central Division (Illinois, Indiana, Michigan, Ohio and Wisconsin) at -3.6 percent; and the Pacific Division (Alaska, California, Hawaii, Oregon and Washington) at -2.6 percent.

The East South Central Division (Alabama, Kentucky, Mississippi and Tennessee) was down at -1.9 percent; the West North Central Division (Iowa, Kansas, Minnesota, Missouri, North Dakota, Nebraska, and South Dakota) at -1.9 percent; the Middle Atlantic Division (New Jersey, New York and Pennsylvania) experienced a -0.6 percent drop; and prices in the New England Division (Connecticut, Massachusetts, Maine, New Hampshire, Rhode Island and Vermont) fell -0.5 percent.

U.S. home prices dropped 8.1 percent in the five-year period from third-quarter 2005 to third-quarter 2010, with the largest drop in the Pacific Division: -20.7 percent.

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