WASHINGTON (MarketWatch) -- Home prices across 20 major U.S. cities have dropped a record 15.3% in the past year and are now back to where they were in the summer of 2004, according to the Case-Shiller home price index released Tuesday by Standard & Poor's.

Prices in the 20 cities are now down 17.8% from the peak two years ago.

Prices were lower in April than they were a year earlier in all 20 of the major metropolitan areas as tracked by the Case-Shiller index.

“ 'There might be some regional pockets of improvement, but on an annual basis the overall numbers continue to decline.' ” — David Blitzer, Standard & Poor's

Las Vegas, Miami and Phoenix saw the biggest declines, with prices falling by 25% or more in the past year. Prices in 10 cities have fallen by more than 10%.

Home prices in Charlotte, N.C., which was the last holdout to show gains, have now slipped 0.1% in the past year.

Prices were down a record 16.3% on a year-over-year basis in a smaller subset of 10 metropolitan areas that have been tracked over a longer period.

With so many homes on the market and foreclosures rising, prices are likely to keep falling, said Patrick Newport, an economist with Global Insight. He foresees prices dropping a further 10%. Listen to the interview with Newport.

All the same, it's worth noting that prices for April fell 1.4% compared with March, the smallest monthly decline in seven months. "It seems that at least the pace of decline has started to lose momentum," wrote Harm Bandholz, an economist for UniCredit Markets, in a note to clients.

But other economists noted that the slower pace of decline in April could be due to the seasonal trend toward higher prices in the spring; the monthly Case-Shiller data are not seasonally adjusted.

A separate index published Tuesday by the federal government showed a smaller 4.6% annual decline.

The Office of Federal Housing Enterprise Oversight index is based on a broader geographic reach, but it's restricted to homes purchased by conforming loans and therefore doesn't capture the gains in the hottest markets where subprime loans and jumbo mortgages once dominated and where foreclosures are surging and prices are plunging.

What goes up, comes down

Home prices surged in 2003 through 2006, climbing by a cumulative 52%, according to Case-Shiller. Since then, however, the housing and credit bubbles have burst and homeowners have given up half of their gains from earlier in the decade.

Falling prices have eroded Americans' wealth, cutting into their ability to borrow against the equity in their homes or refinance or sell for a profit. Millions of Americans now owe more on their homes than they're worth.

The falling home values could also trigger higher monthly payments for many homeowners with negative amortization loans.

But falling prices are likely a necessary ingredient if the housing market is to get growing again.

"We expect the 20-city Case-Shiller composite to fall another 15% to 20%, to a bottom at the end of 2009, translating to a peak-to-trough drop of 30% to 35%," wrote Michelle Meyer, an economist for Lehman Bros.

The Case-Shiller index tracks sales of the same homes over time, so it's not influenced by the mix of homes sold in a period. Unlike the home price index from the OFHEO, the Case-Shiller gauge tracks homes with nonconforming loans, such as subprime loans or jumbo loans, which were common in the frothiest markets.

"There might be some regional pockets of improvement, but on an annual basis the overall numbers continue to decline," says David Blitzer, chairman of the index committee at Standard & Poor's.

Home prices fell in 12 of 20 cities in April compared with March. Prices have fallen in those 12 cities for eight consecutive months.

Here's the city-by-city breakdown in the Case-Shiller index:

Las Vegas, down 26.8% in the past year; Miami, down 26.7%; Phoenix, down 25%; Los Angeles, down 23.1%; San Diego, down 22.4%; San Francisco, down 22.1%; Tampa, down 20.4%; Detroit, down 18%; Minneapolis, down 15.5%; Washington, down 14.8%; Chicago, down 9.3%; New York, down 8.4%; Atlanta, down 7.5%; Cleveland, down 6.8%; Boston, down 6.4%; Seattle, down 4.9%; Denver and Portland, both down 4.7%; Dallas, down 3.4%; and Charlotte, down 0.1%.

In the OFHEO index, here's the regional breakdown:

Pacific, down 15% in the past year; Mountain, down 4.9%; South Atlantic, down 4.8%; New England, down 4.6%; East North Central, down 3.8%; Middle Atlantic, down 3.3%; West North Central, down 2.4%; East South Central, up 0.1%; West South Central, up 1.9%.

After accounting for 4.5% inflation over the past year, real home prices are down in every region.