April home prices up, may not last

Associated Press Jun. 30, 2010 12:00 AM

NEW YORK - Home prices in April rose for the first time in seven months as government tax credits bolstered the market. But the rebound may be short-lived now that the incentives have expired.

The Standard & Poor's/Case-Shiller 20-city home-price index released Tuesday posted a 0.8 percent gain. It had fallen in each of the past six months.

Eighteen of 20 cities showed price increases in April from March. Washington, San Francisco and Dallas posted gains of 2 percent or more. Eleven cities reversed their declines from the month before.

Only Miami and New York recorded price declines. Prices in New York were the lowest since 2004.

Nationally, prices have risen 3.8 percent from their April 2009 bottom. But they remain 30 percent below a July 2006 peak.

The overall price gains highlight the impact of the federal tax credits for homebuyers at the start of the traditionally strong spring selling season. Buyers rushed to purchase before the tax credits expired at the end of April. The numbers are likely to drop in the next report.

David M. Blitzer, the S&P's index chairman, said the recovery is not getting a consistent and sustained boost from the housing market. He doesn't expect that to happen until next year.

Last week, the government reported that new-home sales fell in May to their lowest level on record, plunging 33 percent from the month before. That was the slowest sales pace on records dating to 1963. Sales of previously occupied homes edged down 2.2 percent.


April home prices up, may not last