Home prices in the Washington area slumped in February, dropping 2.3 percent from a year earlier, according to data released Tuesday.
Prices have been dropping since October, the S&P/Case Shiller Home Price Index shows, though the Washington market has fared better than the national average, which dropped 3.5 percent from February 2011 to February 2012.
The Washington market began to rebound last April, said S&P Indices Vice President Maureen Maitland, but the recent decline shows a sustained recovery is still distant.
|Average home prices in the Washington area|
|Source: S&P/Case Shiller|
"What we've seen has been effectively a triple dip in national home prices," she said, pointing to slow job growth and a generally weak economy.
But some experts warn against relying on data that's more than a month old.
March was strong enough that prices were up in the first quarter of 2012 compared with last year, according to Alexandria-based Delta Associates, which relies on local data from Metropolitan Regional Information Systems. Their data -- due to be released Wednesday -- shows the average price of an area home was 3.6 percent higher than during the same period last year.
"We did see a fourth quarter with negative prices ... but every quarter in the past two years has been positive," said Alyson Bode, vice president and director of information resources at Delta Associates. She called the recent downturn a "fluke."
The data indicate the region's road to recovery is going to be a bumpy one --"one associated with cyclical peaks and valleys in both sale value and in price," said Anirban Basu, CEO of Sage Policy Group in Baltimore.
The housing market also has been influenced by outside factors, particularly the federal government.
After the market crashed, government programs artificially inflated it, said Ted Gayer, co-director of the Brookings Institution's Economic Studies program. The recent depreciation is caused partly by those programs ending, such as the first-time homebuyer tax credit.
Psychology is also a factor, Basu said. When people see home prices fall, they wait to sell their home, which makes the prices fall further.
And banks choosing to short-sell houses rather than foreclose also cause prices to drop, he added.
Still, the numbers are more reflective of the outliers than the norm, said local real estate agent Boyd Campbell.
"There are just a few pockets in the District of Columbia, and there are a few pockets in Prince George's County where you have bottom-basement prices ... that impact the average," he said, "but overall we're seeing appreciation, and we're seeing the market get its legs."