The Standard & Poor's/Case-Shiller index released Tuesday showed home prices in 20 major cities tumbled by 18.6 percent from February 2008. That was slightly better than January's 19 percent and the first time since January 2007 the index didn't set a record.
But the good news was mixed. All 20 cities in the report showed monthly and annual price declines, but half recorded annual records. Prices fell by more than 10 percent in 15 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 metros - including Dallas, Denver and Boston - showed improvement in their yearly losses compared to the month before.
"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 a lot of first-time homebuyers interested in homes up to $250,000. He attributes the increase to low interest rates and the $8,000 tax credit.
"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.
Consumers overall are becoming more optimistic about the economy. The Conference Board said Tuesday that its Consumer Confidence Index jumped more than 12 points to 39.2, blowing past economists' expectations of 29.5.
Meanwhile, U.S. fund manager Franklin Templeton is looking to raise about $700 million for real estate investment this year as it braces for a flood of distressed sales from banks, its European property head told Reuters.
"We are going towards a distressed sales situation, but we're not there yet ... banks are still trying to figure out what to do with their problem assets," its managing director for European property, Raymond Jacobs, said in an interview.
The commercial property sector has been ravaged by the credit crisis causing waves of mortgage breaches, but most banks have so far been hesitant to dispose of repossessed assets due to a lack of clear market valuations, he said.