Drop in home prices slows, at last

NEW YORK - In another sign the housing crisis could be reaching the bottom, a drop in home prices in February, while sharp, was not a record fall - the first time in 25 months that has happened.

The Standard & Poor's/Case-Shiller index released yesterday showed home prices in 20 major cities tumbled by 18.6 percent from February 2008. That was slightly better than January's 19 percent decline and the first time since January 2007 the index didn't set a record for the amount of the fall.

All 20 cities in the report - which does not include Philadelphia - showed monthly and annual price declines. Prices fell by more than 10 percent in 15 of the cities, including Las Vegas, San Francisco and Phoenix. In fact, Phoenix home prices have lost more than half their value since peaking in July 2006.

Yet, nine of the metro areas - including Dallas, Denver and Boston - showed improvement in the amount of the price decline compared with January.

"We will certainly need a few more months of data before we can determine if home prices are finally turning around," said David M. Blitzer, chairman of the S&P index committee.

Rich Patterson, a Dallas RE/MAX agent, said in the last two months he's seen many first-time homebuyers interested in homes costing up to $250,000. He attributes the increase in their interest to low mortgage rates and the $8,000 tax credit offered in the federal economic stimulus bill adopted in February.

"The buyers are still getting good deals, but they're not stealing properties," said Patterson, noting that sellers are cutting their asking price about 4 percent to snag a deal.

Last week, home sales data for March also contained some glimmers of hope for a turnaround. Existing home sales fell just 3 percent from February to March, and new home sales seemed to have hit bottom.