Housing prices decline as mortgage defaults rise for first time this year
Housing prices continue to show the steepest declines in the markets most affected by the bubble burst of three years ago, according to the real estate data provider Altos Research. And prices may have further to go still, as one mortgage analytics firm reports that mortgage delinquencies increase for first time this year. The firm's Altos 10-city composite price index fell 1.6% for October, and is off about 3.1% the past three months with Phoenix, Miami and California cities continuing to be hit the hardest. The average national house price is now $458,518, down about 1.6% from the prior month and once again at the lowest level ever recorded by Altos. The average home price in San Diego fell 3.28% last month, while Salt Lake City prices were off by 3.27% and Phoenix prices dropped 3.11%. The company said there has been some stability in its national composite index of late, although inventory is down nationwide and the impact of the shadow inventory looms large. Amherst Securities said new default rates last month picked up for the first time in a year, "echoing fears of renewed home price depreciation." The price declines of the past few months are in line with Altos Research expectations, though weekly declines in prices are slowing. "December’s report should indicate less dramatic price declines, with a few bubbly exceptions," the firm said. According to Amherst, $8 billion in mortgage borrowers passed the two months or greater delinquency in October for the first time. This is an increase of 3.2% from $7.8 billion from the month prior. The financial services firms estimates it will take 48 months to clear the inventory of distressed properties. Write to Jason Philyaw.