3Q home prices up 4%, housing value dips slightly from last quarter
Home prices jumped 4% in the third quarter, though home values stagnated from the previous quarter, according to separate reports Tuesday. Third-quarter prices showed two straight quarters of growth, according to the home price index from Integrated Asset Services. Second-quarter prices had increased 2% from the first quarter. Prices from the third quarter still declined from a year ago, down 0.6%. The two quarters of growth is likely "a calm before the storm" of increasing distress sales, said IAS CEO Paul Sveen. "There is a clear disconnect between the pricing indexes and real market strength," Sveen said in the release. "The absence of distressed sales … is artificially keeping prices from falling." Distress sales were down 39% in July from the year before, according to the IAS report. All four U.S. regions saw home price increases from the second quarter, led by the Midwest (4.4%) and South (4.2%). The Northeast had a 3.8% gain, while the West had a more modest 0.3% increase. Home values for the third quarter didn't fare as well, down 0.2% from the previous quarter according to Zillow [Z]. Values, which averaged nationally at $171,500, were also down 4.4% from a year ago. Still, home values "held up better than would be expected" per economic conditions, said Zillow Chief Economist Stan Humphries. "We're clearly dealing with a crisis of confidence that is keeping potential buyers on the sidelines, fueled largely by high unemployment and more general economic uncertainty," Humphries said in the report. Pittsburgh (1.2%), Detroit (0.9%), Boston (0.5%) and Denver (0.3%) saw home values increase for the quarter among the largest metro areas covered by Zillow. Atlanta had the largest quarterly decline at 3%, followed by Tampa, Fla., at 2.5%. Homes in negative equity, or borrowers who owe more than their homes are worth, increased to 28.6% in the third quarter from 26.8% in the second quarter. Click on the chart below to expand. Write to Andrew Scoggin. Follow him on Twitter @ascoggin.