US Home Prices Fell 0.6% in August From July

U.S. home prices fell 0.6 percent in August versus July, the Federal Housing Finance Agency said on Thursday.

The drop, however, was slightly less than the 0.8 percent fall in July, which is perhaps a glimmer of hope for the hard-hit U.S. housing market as it may indicate that the precipitous drop in home prices could be abating.

A huge supply of unsold homes, tighter lending standards and record foreclosures have pushed down home prices.

For the 12 months ending in August, U.S. home prices fell 5.9 percent, and the cumulative decline since the April 2007 peak is 6.5 percent, according to the Federal Housing Finance Agency's House Price Index.

By region, seasonally adjusted monthly price changes ranged from a decline of 1.8 percent in the Pacific Division states of Hawaii, Alaska, Washington, Oregon and California to an increase of 0.4 percent in the New England states of Maine, New Hampshire, Vermont, Massachusetts, Rhode Island and Connecticut, the report said.

The FHFA monthly index, formerly called the OFHEO monthly house price index, is calculated using purchase prices of houses backing mortgages that have been sold to or guaranteed by Fannie Mae or Freddie Mac . FHFA regulates Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks.

The index was introduced in the Office of Federal Housing Enterprise Oversight's fourth quarter 2007 House Price Index, or HPI, report and has shown less severe price declines than other reports.

For example, the Standard and Poor's S&P/Case-Shiller 20-City Composite Home Price Index slipped 0.9 percent in July from June, bringing the measure down a record 16.3 percent from July 2007.

The 10-City Composite Home Price Index slipped 1.1 percent in July from June, bringing the measure down a record 17.5 percent from July 2007.

But while the annual returns of the 10-City and 20-City Composite indices continue to reach record lows, the pace of the decline has slowed, particularly over the last three months, S&P said.

S&P will release its August figures on Oct. 28.

FHFA's report precedes separate upcoming data gauging the state of the U.S. housing market, currently suffering the worst downturn since the Great Depression of the 1930s.

The National Association of Realtors will release data Friday on U.S. sales of existing homes in September. The Commerce Department will release data Monday on U.S. sales of new single-family homes in September.

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