Seattle home prices show monthly gain for first time in 2 1/2 years

Home prices in Seattle rose on a seasonally adjusted basis in October from September, the first increase in almost 2 ½ years, according to the closely watched Standard & Poor's/Case-Shiller index.

The seasonally adjusted Case-Shiller figure for Seattle rose 0.44 percent in October. The index had fallen every month since peaking in May 2007; it's still down 22.5 percent since then and down 12.5 percent since October 2008.

Seattle was one of 11 cities in the 20-city index to post a seasonally adjusted increase in October.

On a non-adjusted basis, the local index has been essentially flat since March.

The local numbers compare with a seasonally adjusted October increase of 0.37 percent in the 20-city composite index, the fifth month of gains. Without adjusting for seasonal factors, the index was flat from September.

Home-price gains since the summer reflect the rush of buyers trying to close deals before the original expiration date of a federal tax credit. The Nov. 30 deadline was extended last month to April 30.

Besides a credit of up to $8,000 for first-time buyers, Congress expanded the program to include homeowners who have lived in their current properties for at least five years. They can now claim a tax credit of up to $6,500 if they relocate.

The 20-city home-price index was off 7.3 percent from October last year, nearly matching expectations of economists surveyed by Thomson Reuters. Many economists, however, are predicting a double dip in prices this winter as foreclosures increase and government support wanes.

"I'd be very surprised if we don't go below the lows we hit this year," Dean Baker, co-director of the Center for Economic and Policy Research, a left-leaning Washington, D.C.-based think tank. "We still have a very glutted housing market."

The 20-city index is up 3.4 percent from its bottom in May, but still almost 30 percent below its peak in April 2006.

There are also wide variations in price trends around the country. Prices have climbed for at least six months in a row in Denver, Washington, D.C., Minneapolis and San Francisco, for example.

But there's no sign of a bottom in Las Vegas, where prices have tumbled more than 56 percent from their peak in April 2006.

Other cities showing price gains included Charlotte, N.C., Detroit, Los Angeles, Phoenix, Portland and San Diego. Decliners included Atlanta, Boston, Chicago, Cleveland, Miami, New York and Tampa, Fla. Dallas showed no change.

Information from Seattle Times business reporter Drew DeSilver and The Associated Press is included in this report.