The average price of a single-family home declined 1.5% in the third quarter from a year earlier, and prices appear to be stabilizing in many areas of the country, according to a financial services technology firm. Fiserv Inc. (FISV) expects home prices to decline 5.5% this year, but three-fourths of the 375 metro areas the company tracks will see prices stabilize by the end of the year with all markets stabilizing by the end of 2012. The company said 25% of all markets already show signs of prices leveling off, although the Fiserv Case-Shiller Indexes, which use data from the Federal Housing Finance Agency, still point to a slow recovery "with many false starts," especially in areas hit hard by foreclosures. In November, the company was projecting home prices to fall by about 7% this year with double-digits drops in some areas. Fiserv said chronic high unemployment and the number of distressed properties continue to hamper the recovery in many states. The company said housing prices should stabilize in Arizona, California, Florida and Nevada, but Fiserv also said steep decreases are possible "in markets that have been hurt most by the housing crisis." "Large supplies of foreclosed properties will continue to be the biggest downside risk for home prices and metro area housing markets," according to Fiserv Chief Economist David Stiff. "Foreclosure activity declined at the end of 2010, but sales activity of bank-owned homes increased. In bubble and crash markets, the uncertain timing and volume of bank liquidated properties will cause home prices to bounce around their lows for many years." Write to Jason Philyaw.