New York, NY, United States (AHN) – Although home prices were up slightly in May, the major markets showed a negative growth when compared to a year earlier, according to the S&P/Case-Shiller report.

The S&P/Case-Shiller 20-City Composite was down 4.5 percent while the 10-City Composite was down 3.6 percent in May compared to the same month a year ago. May marked the second month in a row that both indexes showed negative growth.

However, home prices were up slightly in May from April in many markets. The 20- and 10-City Composites were up by 1 percent and 1.1 percent respectively for May compared to April.

David M. Blitzer, chairman of the Index Committee at S&P Indices, gave more details in a statement.

“We see some seasonal improvements with May’s data,” Blitzer said. “This is a seasonal period of stronger demand for houses, so monthly price increases are to be expected and were seen in 16 of the 20 cities. The exceptions where prices fell were Detroit, Las Vegas and Tampa. However, 19 of 20 cities saw prices drop over the last 12 months. The concern is that much of the monthly gains are only seasonal.

“May’s report showed unusually large revisions across some of the MSAs. In particular, Detroit, New York, Tampa and Washington DC all saw above normal revisions,” Blitzer said, adding that the adjustments were caused by a lag in the reporting of home sales.

“Also, when sales volumes are relatively low, as is the case right now, revisions are more noticeable,” he said.

“Other recent housing statistics show that single-family housing starts were up moderately in June, and are at about the same pace as a year ago,” Blitzer continued. “Existing-home sales were flat in June, reportedly because of contract cancelations and tight credit. The S&P/Experian Consumer Credit Default indices showed a continuing decline in mortgage default rates since last winter. Other reports confirm that banks have tightened lending standards in the past year, making it harder to qualify for a mortgage despite very low interest rates. Combined, these data all support a continuation of the ‘bounce-along-the-bottom’ scenario we have witnessed in the housing market over the past two years.

“We have now seen two consecutive months of generally improving prices; however, we might have a long way to go before we see a real recovery. Sustained increases in home prices over several months and better annual results need to be seen before we can confirm real estate market recovery,” he said.

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