US house prices suffer 11% drop

The US housing downturn shows no sign of slowing

US house prices fell at an annual rate of 11.4% in January, according to the latest monthly Standard & Poor's/Case-Schiller index.

This was the monthly index's biggest year-on-year decline in 21 years.

The latest snapshot of the slump in the US property market, it comes a day after the main US estate agent body said prices fell 8.2% in February.

The S&P/Case-Schiller index tracks the prices of homes in 10 major metropolitan areas across the US.

Its wider composite index, which covers prices in 20 cities, was down 10.7% in January compared with a year ago, the first time both S&P indexes had dropped by double-digit percentages.

"It shows that the housing correction is still under way," said Lehman Brothers economist Michelle Meyer.

US property prices have fallen sharply on the back of record home loan defaults centred on the sub-prime sector, which offers mortgages to people with poor credit ratings.