A closely watched index released Tuesday showed home prices tumbling by the sharpest annual rate ever in July, but the rate of monthly declines is slowing.

The Standard & Poor’s/Case-Shiller 20-city housing index fell a record 16.3% in July from a year earlier, the largest drop since its inception in 2000. The 10-city index plunged 17.5%, the biggest decline in its 21-year history.

Prices in the 20-city index have plummeted nearly 20% since peaking in July 2006. The 10-city index has fallen more than 21% since its peak in June 2006.

No city in the Case-Shiller 20-city index saw annual price gains in July, the fourth straight month that has happened.

However, the pace of monthly declines is slowing, a possible silver lining. Between May and July, for example, home prices fell at a cumulative rate of 2.2% - less than half the cumulative rate experienced between February and April.

But there’s “no evidence of a bottom,” said David M. Blitzer, chairman of the index committee at S&P.

The pace of dropping home values slowing down is definitely a good sign for homeowners, yet I’d give the market quite some time to gather its wits. In the major boom cities, like Phoenix and Vegas, you see a drop of up to 30%, that’s harsh. Harsh for homesellers, but definitely an opening for investors who have equity ready to invest.

No evidence of a bottom… Well, let me tell you this much. Whenever a media outlet pushes out a headline that the bottom has finally been reach, trust me, it’s already old news. Greed is what made the economy what it is right now, so I can’t suggest to investors to wait for the market to plunge down even further. In my opinion, I can’t see it getting any worse than now. It seems like Congress will be putting up another bailout for voting, and I’m pretty sure that it’ll happen this time. I just hope that the fine print will be fair for the average American though.

Las Vegas prices plunged the most at nearly 30%, with Phoenix diving 29% and Miami 28%. Prices in the seven cities in the Sunbelt all fell between 20% and 30% from a year ago.

Only seven cities showed positive or flat returns from June to July, down from nine that showed month-over-month gains in June. Atlanta, Boston, Dallas, Denver and Minneapolis all posted positive returns for three months or more.

It’s great to hear that 5 metros have stood strong through this tough year. Yesterday was a real heartbreaker for those in the finance sector, but all I can really tell you is that life goes on, and America will get back on track. Elections aren’t too far away, and I can only urge you to vote. We have already seen how incompetent McCain is. If he’s this incompetent as a presidential candidate, it will only be worse when he’s in the Oval Office. Not only should we be voting for our choice of President, but also for the officials of our city and the city’s propositions.

Credits: CNNMoney.com

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