The pace of decline in home prices moderated in April, while consumers this month turned more gloomy amid jitters about the labor market and economic outlook, data showed on Tuesday.
The housing data suggested the start of the spring buying season helped, though economists cautioned home prices will likely continue to crawl along at low levels, and could have further to fall, as the battered housing market works through a slew of headwinds.
Average home prices fell from a year ago and were still at levels seen in the summer of 2003.
"The pace of decline seems to be slowing some, so that is good. We have to do that before you can actually start increasing," said Mike Feroli, economist at JP Morgan in New York.
"I would expect prices are flattish in the second half (of 2011), and it may be a while before we see positive growth of any significance."
The S&P/Case-Shiller composite index of single-family homes in 20 metropolitan areas dipped 0.1 percent month-over-month on a seasonally adjusted basis. A Reuters poll of economists had forecast a decline of 0.2 percent.
On a non-seasonally adjusted basis, however, the index rose 0.7 percent, its first advance in eight months, the report said.
"The seasonally adjusted numbers show that much of the improvement reflects the beginning of the spring-summer home buying season," David Blitzer, chairman of the index committee at Standard & Poor’s, said in a statement.
"It is much too early to tell if this is a turning point or simply due to some warmer weather."
Prices in the 20-city index fell 4 percent year over year, slightly worse than expectations for a drop of 3.9 percent.
An excess amount of houses for sale, ongoing foreclosures, tight credit and weak demand have all kept the housing market on the ropes even as other areas of the economy begin to recover.
The report helped give U.S. stocks a boost, as did optimism the Greek parliament would adopt an unpopular austerity plan needed to avert the euro zone’s first default.
Separate data showed consumer confidence fell in June to the lowest point since November on concerns about the slack labor market and sputtering recovery.
