The good news is that home prices rose for a fourth straight month in most major U.S. cities in July, from June, no shocker because we’ve just emerged from the busiest buying season. And that includes Dallas — a whole point (.3) 3%. The bad news is that when you look at last year, home prices are still trending downward, even in Dallas. Experts are warning us, no  duh, the housing market remains precarious and depressed. (And unemployment! And Dodd-Frank!) Prices are expected to decline more in the coming months. So if you are shopping for a home, get ready, get set, dive in now.

Standard & Poor’s/Case-Shiller Home Price Index, which some regardas the Bible when it comes to real estate analysis, showed home prices increased in July from June in 17 of the 20 cities CS tracks. I would not be too giddy that Detroit, Chicago and Minneapolis posted the biggest monthly percentage gains — those cities have been on life support and really, still are. Prices are still falling in Las Vegas and Phoenix, which is not what those homeowners need to hear.

But North Texas prices were down 3.2 percent in July, 2011 from a year ago, the 13th month in a row that local home prices were trending downward. Home values in the D/FW area have been declining since federal housing tax credits for first time buyers expired in early 2010. Still, 3.2 percent not as bad as 4.1 percent, which is how much national home prices have trended downward over the last year. As someone said: it’s basically 2003.

Eighteen of the 20 major U.S. markets in Case-Shiller’s latest survey saw annual home price declines in July. Who was up over last year? Washington, D.C., Boston, Charlotte, Miami (foreign buyers), Tampa — but we are talking negligible amounts.

I’m actually beginning to think though, that this might be the bottom or very close. The reason is inventory: dwindling by the minute. Yesterday, CoreLogic, a leading provider of real estate information, analytics and business services, reported that the current residential shadow inventory as of July 2011 had declined slightly to 1.6 million units, representing a supply of 5 months. This is down from 1.9 million units, a supply of 6 months, where it was a year ago. It also follows a decline from April 2011 when shadow inventory stood at 1.7 million units.

What that means: there may be less distressed inventory coming on the market to drag down home prices. That slowdown could be driven by a a slower pace of disposing of new delinquencies, too. Keep in mind that the vast majority of distressed assets are below $500,000.

“It’s The Housing, Stupid.” What I hope someone writes on a wall somewhere in the White House.

Now that there is a pay wall at the Dallas Morning News — I do subscribe — I will try and give you a weekly re-cap of real estate news and a look/see at what our local market is doing. Let’s call it Good News/Bad News. Because, as we all know, just because the sky is falling in Maryland, it may not be here in Dallas. Here’s a piece I wrote on AOL, eager to show the world that housing is not blanket-ly bad. Because if you read the headlines Monday, you may have wanted to go back in bed and pull up the covers for another five years. Yahoo News: “Home Sales Tumble”. The National Association of Realtors says home sales tumbled 9.6 % and are at a 9 year low, which I guess is better than a ten year low.

“The housing market is still very depressed and a major drag on the economy, especially household net worth,” said Chris Christopher, a senior economist at IHS Global Insight in Lexington, Massachusetts.

Economists had expected a decline of only 4 percent, but 9.6 was greater than even the most pessimistic forecast in a Reuters survey of 53 economists. And it is making Dr. Doom  Bob Shiller almost look like an oracle.

And what good will an improving labor market be if plunging house prices keep upsetting economic stabilization?

Someone sure needs to plaster this sign at the next convention, Democratic and Republican: “It’s The Housing, Stupid.”

Thanks to continued downward pressure from foreclosures, NAR said the median national home price dropped 5.2 percent in February from a year earlier to $156,100, the lowest since April 2002.

“If the price declines persist, even with the job market recovery, that could hamper recovery in the housing market,” said Lawrence Yun, NAR’s trade group’s chief economist.

And that ticks me off because average homes sales actually increased over the last six months in five major Texas metropolitan markets — Austin, San Antonio, Houston, Dallas, Fort Worth — according to the Federal Reserve. I don’t care how much it bites elsewhere, there are signs of life in the Lone Star state that keep getting beaten down by the national doom drum.

Good news: that rise in Texas home sales comes for the first time since the expiration of the home buyer tax credit. And more good news: looking at January numbers, Texas home inventory is down, says the Federal Reserve. Back in December, it would have taken eight months to sell off all the inventory in the state. In January, that time frame fell to 7.7 percent. Experts say 6 months is a normal market and it looks like Texas real estate is inching closer and closer to normal.

As for foreclosures, it almost seems like they’ve taken a vacation in some Texas markets. Foreclosure filings in Dallas/Fort Worth were down 16 percent for April — foreclosure filings have to be posted a month ahead, so April’s numbers are now out. For the first few months of 2011, Dallas foreclosure filings are 4 percent lower than this time, last year. And that is significant because last year we were still euphoric on the first time home buyer’s credit.¬† Foreclosure filings were also down 20 percent in Collin County, and an area hit hard by foreclosures.

But George Roddy isn’t calling it Miller Time just yet. What still plagues is the high number of troubled loans across the state, and fallout from the foreclosure crisis is going to take a long time to wade through. More jobs would be the biggest help of all.

“Until a significant number of workers are absorbed back into the workforce,” says Roddy, ” we won’t see foreclosure postings decline.”

Bad news: the number of upside-down homes is up. Even though foreclosure postings are down, we are seeing a sharp increase in the percentage of residential postings in an upside-down position. The percentage of foreclosure postings on upside-down homes jumped 29 percent. A year ago April, only 21 percent of Dallas area homes were upside down.

You know what that means: The original mortgage amount exceeds the current value of the property. So the homeowner can not sell the home for what is owed on the mortgage and often, neither can the bank left toting the note.

Good news (kind of): CoreLogic recently estimated that 12 percent of Dallas homeowners owe more than their mortgages are worth. That is about half the nationwide rates of negative equity, and can be attributed to Texas law which limits how much a homeowner can borrow against their home. Me, I was perfectly happy when we couldn’t borrow squat against our homes.

Finally, I wonder when this administration is going to make some positive noises about home ownership. Isn’t it interesting that one of the hottest markets in the country is D.C?