First American CoreLogic: Housing Prices Off 10.2%

(Update 1) Housing prices across the nation on average lost a little more than 10% in April when compared to prices one year earlier, according to research from First American CoreLogic, which also said its LoanPerformance Home Price Index saw the pace of price declines slow to their lowest levels this year. Home price declines have been abating throughout the year, peaking at -11.9% during January 2009, according to the firm — the 10.2% decline posted in April represents the smallest year-over-year decline recorded this year thus far. The LoanPerformance HPI is a repeat-sales index that tracks increases and decrease in sales prices for the same homes over time. It covers 7,677 ZIP codes, 958 Core Based Statistical Areas (CBSA) and 678 counties. On a month-to-month basis, April’s decline represents a 0.5% improvement over the 10.7% decline posted during March, the company said in a press statement. The improving data is likely to add further fuel to recent speculation that real estate may be nearing a recovery point, although First American CoreLogic chief economist Mark Fleming preaches caution in reading too much into the data. “There is still a great deal of uncertainty with the housing market and the economy in general,” he said. “But the rate of change in home price declines is beginning to show signs of not only a bottoming, but an improvement in both nominal and real terms, which is the more important indicator because real prices adjust for the distortions caused by inflation or deflation.” As expected, the study shows the so-called “sand states” — Arizona, California, Florida and Nevada — suffered disproportionally more than other parts of the nation. Advances in prices in Texas cities, however, helped soften the final result. According to the study, the shifts among the top five states have continued this month with Nevada (-26.1%) remaining the top-ranked state for annual price depreciation, but Florida (-23.2%) supplanted California and became the second-ranked state for price depreciation. After being the top-ranked state for 20 consecutive months — May 2007 through December 2008 — California’s (-22.7%) home price declines have improved sharply, putting California into third place in April 2009 and just ahead of fourth-ranked Arizona (-20.5%). The rapid deterioration of home prices in Illinois (-17.4%) put that state in fifth place for the first time during the downturn, indicating that woes in the nation’s real estate market may be shifting to other areas. Since U.S. home prices peaked in July 2006, national home prices have declined -21.2% on a cumulative basis, according to First American CoreLogic data, and are currently down to the lowest price level in more than five years. Write to Jacob Gaffney.

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