Amidst all the hopeful news about improving home sales, starts, permits, and builder confidence, the home building industry got a painful reminder today that its gains have largely come at the cost of prices. According to the latest release of the S&P/Case-Shiller Home Price Indices, all three indices—the national composite, the 10-city, and the 20-city—hit new index lows in December.

The national composite, which covers all U.S. Census divisions, fell by 3.8% during the fourth quarter of last year and was down 4.0% on an annual basis. Both the 10- and 20-city composites were down 1.1% in December from the previous month and registered year-over-year losses of 3.9% and 4.0%, respectively.

However, the indices numbers are not seasonally adjusted. Once seasonal factors are taken into account, the national loss shrinks to 1.7% and the drop for both the 10- and 20-city composites drops to 0.5%.

Of the 20 metro areas tracked, 18 saw monthly declines in December, with Miami and Phoenix posting the only improvements with gains of 0.2% and 0.8%, respectively. Four cities—Atlanta, Las Vegas, Seattle, and Tampa, Fla.—each saw their average home price fall to a new low. Once numbers are seasonally adjusted, the number of cities posting declines drops to 12. Detroit was the only city to log an annual gain, with a return of 0.5%.

"While we thought we saw some signs of stabilization in the middle of 2011, it appears that neither the economy nor consumer confidence was strong enough to move the market in a positive direction as the year ended," said David M. Blitzer, chairman of S&P Indices’ Index Committee. "Up until today’s report we had believed the crisis lows for the composites were behind us. … If anything, it looks like we might have reentered a period of decline as we begin 2012."

Not all indicators seem to agree, however. The Federal Housing Finance Agency’s (FHFA) home price index has recently shown home prices stabilizing. The discrepancy can be attributed to the kinds of mortgages tracked in each index, wrote Patrick Newport, U.S. economist at IHS Global Insight, in a release regarding the numbers. "The Case-Shiller indices track all transactions. The FHFA indices include only transactions financed with mortgages that are under Fannie Mae’s and Freddie Mac’s jurisdiction. These mortgages are in much better shape than mortgages overall. … This suggests that the prices of homes that are not facing foreclosure (i.e., most homes) may be stabilizing."

Claire Easley is a senior editor at Builder.

Learn more about markets featured in this article: Phoenix, AZ, Detroit, MI, Miami, FL, Greenville, SC.