Home prices in 20 U.S. cities unexpectedly rose in January, indicating the housing market is stabilizing as the economy expands. The S&P/Case-Shiller home-price index climbed 0.3 percent from the prior month on a seasonally adjusted basis after a similar gain in December, the group said today in New York. The gauge was down 0.7 percent from January 2009, the smallest year- over-year decrease in three years.Cheaper homes, low borrowing costs and government incentives are combining to support the housing market, which helped trigger the worst recession since the 1930s. A lasting recovery requires gains in hiring that may help stem foreclosures, easing the pressure on prices and giving Americans the confidence to spend.“Housing is off the bottom, and home prices are finding a bottom,” Stuart Hoffman, chief economist at PNC Financial Services Group in Pittsburgh, said before the report. “Prices aren’t free-falling anymore.”
By Shobhana Chandra, March 30, 2010 Bloomberg

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