Bad news for housing prices

Shiller Index is out but the sales activity masks underlying weakness

Home prices rose modestly in October, mostly because of a flood of buyers seeking to take advantage of the government’s offer of a tax credit, data released Tuesday showed.

Underneath this apparent good news, however, were some disquieting signs of deterioration.The Standard & Poor’s/Case-Shiller home price index, a widely watched measure of the housing markets in 20 metropolitan areas, rose 0.4 percent from September on a seasonally adjusted basis. It was the fifth consecutive month that prices were up.But seasonal adjustments tend to hide any weakness in the cooler months, when fewer houses are sold. On an unadjusted basis, the index was flat in October.

“We’ve started to see the possibility of either a leveling off of prices for a few months or perhaps a double-dip,” said Maureen Maitland, the vice president for index services at S.& P.

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