National house prices fell 0.6% in February, the seventh consecutive month of decline, keeping prices "only fractionally higher" than levels seen in 2004, according to collateral valuation firm Integrated Asset Services
Although February's decline is smaller than recent months -- like 0.7% in December
-- the IAS house price index is now down 25% from its peak in July 2007.
Two of the four US census regions gained modestly February — 0.8% in the Midwest and 0.2% in the Northeast. IAS noted the increases were weaker than usual for the time of the season. The South and West fell 1.4% and 0.9%, respectively. Both regions produced negative returns for seven straight months.
“By now, the normal seasonal upturn in housing activity should have begun,” said Dave McCarthy, president and CEO of IAS. “But we’re looking at trend lines for neighborhoods all around the country and we just aren’t seeing the typical forces at work."
Results in a number of the nation’s large metropolitan statistical areas (MSAs) echoed the trend. IAS said the Los Angeles MSA, for example, does not appear to be following the seasonal pattern this year, most likely due to the extreme economic crisis in California. Additionally, Las Vegas, Miami and Denver are also running counter to the typical seasonal upswing.
Foreclosed houses add to the inventory of unsold homes, which compete with more expensive new housing, IAS said. The firm noted more than 300,000 homes received foreclosure filings last month, and the number may reach 4.5m by year-end, indicating downward pressure on prices is likely to continue in the near-term.
Data studied by IAS for the index includes non-conforming, bank-owned, and conventional sales transactions segmented by property type in addition to those insured by the Federal Housing Administration and the US Department of Veterans Affairs. The index also considers REO transactions.
Write to Diana Golobay