First American Home Price Index Down 5.7%
National home prices declined 5.7% year-over-year in November, according to First American CoreLogic’s LoanPerformance Home Price Index (HPI). That’s an improvement from October’s year-over-year decline of 7.6%, but prices also declined 0.2% in November compared to October. Excluding distressed sales, prices declined 5.1% year-over-year in November, compared to a 5.7% decline in non-distressed sales prices in October. First American CoreLogic projects the HPI to experience further price declines in the winter before starting to recover in spring. The firm projects its HPI will decline 0.23%, but increase 2.94% excluding distressed sales, by November 2010. For the 45 largest core based statistical areas (CBSAs), the HPI is projected to rise an average of 1% per market through November 2010. “On average, we are expecting home prices to turn around next spring,” said Mark Fleming, chief economist for First American CoreLogic. “While the share of [real estate owned] REO sales are down, allowing price declines to moderate, there is concern moving forward with the levels of shadow inventory, negative equity, and the ability of modification programs to mitigate this risk.” Including distressed transactions, the HPI has fallen 30.0% nationally through November from its peak in April 2006. Excluding distressed properties, the national HPI has fallen 21.8% from the same peak, First American CoreLogic said. Nevada experienced the worst year-over-year price decline at 22.5%, followed by Arizona (14.9%), Florida (13.7%), Michigan (12.6%) and Idaho (11%). Excluding distressed sales, the worst five states for year-over-year price declines were only slightly different. Nevada (19.7%) still holds the top spot, followed by Arizona (14.1%), Florida (12.3%), Michigan (10.6%) and West Virginia (9.6%). The markets with the largest year-over-year declines are all located in the Midwest and Great Lakes areas, led by Detroit (13.1%), Sault Ste. Marie (11.0%), Saginaw (9.7%) and Kalamazoo (7.8%). In the Sun Belt, prices are down the worst in Las Vegas (6.5%), followed by Phoenix (-3.3%), Reno (-3.3%) and Orlando (-2.5%). Write to Austin Kilgore.