Despite a 2.5 percent drop in home prices in the fourth quarter of 2009 compared to a year ago, the year-over-year decline rate has improved compared to the first, second and third quarters of 2009 according to the latest Standard & Poor’s/Case-Shiller Home Price Indices released Feb. 23. In those three quarters, the index dropped 19 percent, 14.7 percent and 8.7 percent, respectively.

As noted in the report, home prices across the country were at summer 2003 levels as of December. The 10-city composite fell 2.4 percent compared to November 2008 while the 20-city composite dropped 3.1 percent.

“As measured by prices, the housing market is definitely in better shape than it was this time last year, as the pace of deterioration has stabilized for now. However, the rate of improvement seen during the summer of 2009 has not been sustained,” David Blitzer, chair of Standard & Poor’s Index Committee, said in the news release. “In the most recent months, we are seeing fewer and fewer MSAs reporting monthly gains in prices.”

Both the 10-city and 20-city composites, as well as all 20 metropolitan statistical areas, saw improvements in year-over-year returns in December compared to the previous month. However, Detroit, Las Vegas and Tampa continued to record negative double-digit annual rates. On a brighter note, Miami, Phoenix and Seattle moved from negative double digits to single-digit territory in December.

When examining month-over-month data, 15 of the 20 MSAs recorded declines in December compared to the previous month. With a decline of 1.6 percent, Chicago recorded the steepest drop while Las Vegas, up 0.2 percent in December, posted its first positive gain in more than three years.

Charlotte, Seattle and Tampa all posted their lowest rates in four years, which has repositioned their current trough values to December 2009 levels. However, San Diego posted its eighth consecutive monthly increase, and Los Angeles and Phoenix posted their seventh.