The nation’s real estate correction gained momentum during September, with economic turmoil placing pressure on an already battered housing market to push prices down at a record pace during the month. According to the S&P/Case-Shiller home prices indices, released Tuesday morning, prices in 20 key metropolitan areas fell 18.6 percent during Sept., while a 10-city composite index registered an annual decline of 17.4 percent. A separate national home prices index covering all nine census divisions found a record 16.6 percent decline in the third quarter of 2008, versus the third quarter of 2007, Standard & Poor’s said in a statement. Prices fell 3.5 percent between the second and third quarters, compared to a 2.2 percent drop between Q1 and Q2. “The turmoil in the financial markets is placing further downward pressure on a housing market already weakened by its own fundamentals,” said David Blitzer, chairman of the index committee at Standard & Poor’s. “All three aggregate indices and 13 of the 20 metro areas are reporting new record rates of decline.” In terms of the quarterly national index, home prices have now fallen back to where they were in 2004 — a crash in housing prices, if there ever was one. Through Sept., S&P’s 10-City composite index is down 23.4 percent from its peak, while the 20-City composite is down 21.8 percent and the national composite is down 21.0 percent. Phoenix was the weakest market, reporting an annual decline of 31.9 percent, followed by Las Vegas, down 31.3 percent, and San Francisco at -29.5% percent. Miami, Los Angeles, and San Diego did not fare much better with annual declines of 28.4 percent, 27.6 percent and 26.3 percent, respectively. All 20 metros tracked by the monthly S&P/Case-Shiller data posted negative results month-over-month in Sept., with San Francisco posting a 3.9 percent monthly price decline and Phoenix posting a 3.5 percent monthly drop. And all 20 metros also posted negative yearly results, as well; only Cleveland saw its 1-year change moderate during the month, posting a 6.4 percent annualized decline relative to the 6.6 percent drop recorded in August, S&P said. Read the full S&P report here. Write to Paul Jackson at paul.jackson@housingwire.com.

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