(RTTNews) - While Standard and Poor’s released a report Tuesday morning showing a continued decrease in home prices in the month of August, the pace of the annual rate of decline slowed by even more than economists had been expecting.

The report showed that the S&P/Case-Shiller 20-City Composite Home Price Index fell at an annual rate of 11.3 percent in August compared to a 13.3 percent decrease in July. Economists had been expecting the report to show an 11.9 percent drop in prices.

With the slowdown in the annual rate of decline, prices fell at the slowest rate since January of 2008. S&P said that this marks approximately seven months of improved readings in these statistics, beginning in early 2009.

The slowdown came as nineteen of the twenty metro areas showed an improvement in the annual rates of decline in August. Cleveland was the only exception.

“Broadly speaking, the rate of annual decline in home price values continues to improve,” said David M. Blitzer, Chairman of the Index Committee at S&P. “While many of the markets remain down versus this time last year, the relative rate of decline has shown some real improvement.”

“Once again, however, we do want to remind people of the upcoming expiration of the Federal First-Time Buyer’s Tax Credit in November and anticipated higher unemployment rates through year-end,” Blitzer added. “Both may have a dampening effect on home prices.”

On a monthly basis, the report showed that the 20-City Composite Home Price Index rose 1.2 percent in August, marking the fourth consecutive monthly increase in prices. Seventeen of the twenty metro areas reported a monthly increase in prices.

S&P noted that only Charlotte, Cleveland and Las Vegas reported monthly declines in prices, while Minneapolis and San Francisco reported positive returns greater than 2 percent and nine of the metro areas reported monthly returns greater than 1 percent.

Housing data is likely to remain in focus on Wednesday, with the Commerce Department due to release its report on new home sales in the month of September. Economists expect the report to show that new home sales rose to an annual rate of 440,000.

Last Friday, the National Association of Realtors released a report showing that existing home sales increased by much more than expected in the month of September, with first-time home buyers driving sales up to their highest level in over two years.

The report showed that existing home sales jumped 9.4 percent to an annual rate of 5.57 million units in September from a 5.10 million unit rate in August. Economists had been expecting a more modest increase to a 5.35 million unit rate.

With the bigger than expected increase, exiting home sales activity rose to its highest level since reaching a 5.73 million unit rate in July of 2007.

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Posted in Categories: Economy, Forex, Releases, USA.

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