NEW YORK (TheStreet) -- Here's a sobering fact for anyone who clings to the idea a home is a great investment: With the big gains of the past couple of years, the average U.S. home is now worth what it was in 2004. In other words, as investments, homes have returned zero in 10 years.
By comparison, stocks have been terrific. Despite the huge selloff during the financial crisis, the Standard & Poor's 500 has gained about 106% over the past 10 years, assuming all dividends were reinvested.
The dreary facts on long-term home prices, contained in this month's S&P/Case-Shiller Home Price Indices, is accompanied by data showing that recent home price gains are slowing.
"Although home prices rose in April, the annual gains weakened," said David M. Blitzer, chairman of the index committee at S&P Dow Jones Indices. "Overall, prices are rising month to month, but at a slower rate. Last year some Sunbelt cities were seeing year-over-year numbers close to 30%, now all are below 20%: Las Vegas (18.8%), Los Angeles (14.0%), Phoenix, Ariz. (9.8%), San Diego (15.3%) and San Francisco (18.2%). Other cities around the nation are also experiencing slower price increases."
In the 20 largest metropolitan areas, home prices gained 10.8% in the year ended in April. Though the average home price has gone up about 25% in the past couple of years, it remains nearly 20% blow the peak in 2006.