Home prices in major metro areas around the country continued to decline in January, according to the S&P/Case-Shiller Home Price Indices, released today. Both the 10- and 20-city composites were down on an annual basis, declining 3.9% and 3.8%, respectively; and both were down 0.8% from the previous month.

Of the 19 metro statistical areas (MSA) represented (Charlotte, N.C., was not included in this month’s release due to delays in data reporting), 16 saw price drops on a monthly basis, although exceptions included the hard-hit markets of Miami and Phoenix, as well as Washington, D.C. On an annual basis, the only MSAs to report improvement were Denver, Detroit, and Phoenix.

The indices’ numbers, however, may not be as bad as they seem—both literally and in terms of what they imply for the industry as a whole. First, the composites are not seasonally adjusted. Once seasonal factors are taken into account, the 10-city composite’s monthly loss shrinks to only 0.1%, the 20-city remains flat, and the number of MSAs reporting declines falls to 10.

As for larger market implications, "falling prices are not so much a reflection of market health, but rather the result of banks disposing of distressed assets by offering low prices to cash buyers," wrote Gary Painter, an economist at the University of Southern California Lusk Center for Real Estate, in a statement anticipating today’s release. "As these distressed properties are taken off the market, that trend will end. When employment and rents increase at the local level, more buyers will see the value of entering the single-family market. If the economy continues moving in this direction, it is likely we have seen the bottom and are moving toward recovery."

To see the full report and data for individual MSAs, click here.

Claire Easley is a senior editor at Builder.

Learn more about markets featured in this article: Dallas, TX, Denver, CO, Phoenix, AZ, Miami, FL, Washington, DC, Greenville, SC, Charlotte, NC.