Feb. 24--Home price appreciation in the Chicago area and across much of the country continued to lose steam in December, adding to concerns about a faltering housing market as a new sales season gets underway.
The S/Case-Shiller home price index, released Tuesday, showed home prices in the Chicago area fell 0.9 percent in December, compared with November. That followed a 1.2 percent drop in November. It was the fourth consecutive month-over-month decline for the local housing market.
The home price index's methodology is different from that of the monthly reports by trade groups like the Illinois Association of Realtors. The index is a three-month moving average, tracking single-family home prices over time. The Realtors' computation of median prices looks at all home sales that occur during a given month.
For the year, Chicago-area home prices gained just 1.3 percent, the smallest gain of all 20 major metropolitan areas included in the widely watched index. The next smallest annualized increases were in Cleveland and Washington, D.C., which each had a 1.5 percent price increase.
By comparison , Chicago-area home prices rose 11.2 percent in 2013, according to the index. Condominium prices fell 0.6 percent in December from November but were up 1.1 percent year-over-year.
Nationally, home prices fell 0.1 percent in December from November and were up 4.6 percent in 2014, compared to 2013.
None of the 20 cities included in the index posted a better monthly price gain in December than the 0.7 percent uptick recorded in Miami.
"The softness in housing is despite favorable conditions elsewhere in the economy -- strong job growth, a declining unemployment rate, continued low interest rates and positive consumer confidence," said David Blitzer, chairman of S Dow Jones' Indices index committee.
The slowdown, while not good news for home sellers, isn't viewed as negatively by many economists. For months, they have said the market needed to return to more tempered gains and that the runaway appreciation rates weren't healthy for the market's long-term viability.
mepodmolik@tribpub.com
