NEW YORK (Reuters) - Single-family home prices declined in September, highlighting the fragility of a market that is struggling to get back on its feet, a closely watched survey showed on Tuesday.
COMMENTS:
KEVIN CARON, MARKET STRATEGIST AT STIFEL, NICOLAUS & CO IN FLORHAM PARK, NEW JERSEY
"It is accelerating to the downside and you don't want that. And it comes in the face of record low mortgage rates.
"If you are looking at the equities markets what you are going to be concerned about are...the global appetite for risk and that is going to be tied to the perception of health in the banks and to the extent that mortgage assets become impaired that is yet another weight on the banks."
BARCLAYS CAPITAL ECONOMICS RESEARCH
"In general, those regions with the highest concentration of foreclosures continue to post the largest price declines. We expect prices to begin to stabilize as distressed sales gradually decline as a proportion of total sales, but this process will take some time."
BRIAN JONES, SENIOR ECONOMIST, SOCIETE GENERALE, NEW YORK
"The rate of drop has subsided slightly on a year over year basis but in the last year, April was the only month out of 12 where we reported a sequential gain. The details of this report show weakness was broadly based across the areas surveyed.
"These numbers are from September. There's probably further to go on prices, but the residential home market is probably stabilizing. The months' supply of homes at 6.3 is a long-term historical average. That's telling you supply and demand for new homes is in balance but at very low levels.
"Looking at the housing sector overall, to be fair the existing home sales numbers were a little better. Pending home sales figures are likely to be better. Overall we're going sideways. Starts should probably post modest gains in the months ahead. Multi-family activity is pretty solid.
"There are so many homes on the market. People are lowering prices to clear the market."
DAVID SLOAN, ECONOMIST, IFR ECONOMICS, A UNIT OF THOMSON REUTERS
"The data clearly implies a very weak housing market in September. Home sales and housing starts have shown some modest improvement since then, and the NAHB homebuilders index is looking quite promising. However there is little reason to expect prices to stage a quick turnaround. Before seasonal adjustment price data tends to weaken into the winter, and recently the tendency for winter weakness has appeared to deepen, with even the seasonally adjusted numbers tending to look weaker in the winter months. The quarterly index did manage a marginal 0.1% increase in Q3 before seasonal adjustment, but an adjusted 1.2% decline reveals weakness. The Q3 numbers were weaker than Q2's, which saw a 3.8% rise unadjusted and a marginal 0.2% adjusted increase."
TOM PORCELLI, CHIEF US ECONOMIST, RBC CAPITAL MARKETS, NEW YORK
"Ultimately we continue to expect home prices to remain under pressure. This report is generally consistent with that idea. The supply-demand imbalance that exists in the housing market will continue."
TODD SCHOENBERGER, MANAGING DIRECTOR AT LANDCOLT TRADING IN WILMINGTON, DELAWARE
"No surprise whatsoever. This continues to validate all our concerns, which is that the housing recovery isn't occurring, and that if anything we're heading toward a housing depression.
"From a trader's perspective, all you needed was a couple of decent headlines to change sentiment, and we've had that with news from Europe and holiday spending. That was the ingredients for a decent rally yesterday and should keep the trend upward as we go into December."
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