US housing prices posted a record annual decline of 16.3% in July, disappointing economists and delivering the latest setback to the search for signs of recovery.

According to the closely watched Case-Shiller index, produced by Standard & Poor’s and released yesterday, home prices in 20 large US cities fell faster than both the 16% drop expected by most economists and the previous record of 15.9% in June.

On a monthly basis, the readings were mixed. Although the pace of the price drop accelerated in July to 0.9% from 0.5% in the previous month, declines over three months have eased significantly from earlier in the year.

'House prices are tumbling down a hill but the slope is elevating,' said Patrick Newport, US economist at Global Insight in Massachusetts.

Financial Times, The Times, the Independent