NEW YORK. Home prices in 20 U.S. cities rose less than forecast in February from a year earlier, a sign a housing recovery will take time to develop.
“The big plunge is over, but significant strength is unlikely,” said Jim O’Sullivan, chief economist at MF Global Ltd. in New York. A pickup in employment is needed to help stem the damage from mounting foreclosures that are restraining further gains in property values.
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Prices may improve in coming months as homebuyers rush to take advantage of a government tax credit worth as much as $8,000. Purchase contracts must be signed by the end of this week and transactions need to close by the end of June for buyers to be eligible.