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Home values drop 0.2% from a year ago: Freddie Mac

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Home values in the U.S. fell 0.2% in the second quarter of 2010 from the same quarter last year, according to the Freddie Mac Conventional Mortgage Home Price Index (CMHPI). The CMHPI Purchase-Only Series includes only property values based on home purchases with a conventional mortgage. Freddie calculates the values for the nation, all 50 states and the nine Census divisions. The numbers are not seasonally adjusted. National home values did increase 3.1% from the previous quarter, the first time since the second quarter of last year that home values rose in all nine Census divisions. Amy Crews Cutts, the deputy chief economist at Freddie Mac, said the second quarter increase was due in part to the homebuyer tax credit that expired in April. With the end of the tax credit came a drop in demand. The National Association of Realtors (NAR) reported a 27% drop in existing home sales in July to a decade-long low. But Crews Cutts said 30-year fixed mortgage rates dropped more than half a percentage point since the end of April, setting new lows in the Freddie Mac mortgage rate survey. "We will be watching carefully the home sales reports in August and September to see whether the July drop was the start of a new trend down or the result of a temporary pull-forward due to the tax-credit programs," Crews Cutts said. Home values in the Pacific Division, which includes Alaska, California, Hawaii, Oregon and Washington, increased 4.2% over the past year, the largest increase of any region. But over the past five years there, values have declined 14.7%. The Mountain Division, which includes Arizona, Colorado, Idaho, Montana, New Mexico, Nevada, Utah and Wyoming, saw home values drop 3.8% over the last year, the largest decline of any region. The largest drop in home values over the past five years came in the West South Central Division, which includes Arkansas, Louisiana, Oklahoma, and Texas. There, values have declined 16.6% in that time. Write to Jon Prior.

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