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Annual Home Prices Continue to Depreciate

National home prices, including distressed sales, declined by -7.8 percent in October 2009 compared to October 2008, according to First American CoreLogic and its LoanPerformance Home Price Index (HPI). This was an improvement over September’s year-over-year price decline of -9.5 percent.* On a month-over-month basis, however, national home prices declined by -0.7 percent in October 2009 compared to September 2009.

• Including distressed transactions, the HPI has fallen -30.1 percent from its peak in April 2006. Excluding distressed properties, the national HPI has fallen -21.5 percent from the same peak.
• When distressed sales were included Nevada (-24.3 percent) remained the top-ranked state for annual price depreciation followed by Arizona (-17.3 percent), Florida (-15.5 percent), Michigan (-13.9 percent) and Idaho (-12.1 percent). Of these, Nevada, Florida and Michigan also showed month-over-month decreases in their HPI.
• Excluding distressed sales, the worst five states for year-over-year price declines changes slightly. Nevada (-20.2 percent) still holds the top spot, followed by Arizona (-14.7 percent), Florida (-13.7 percent), West Virginia (-10.4 percent) and Washington (-9.4 percent).
• There is a growing pending (shadow) supply of 1.7 million homes as of September 2009, up from 1.1 million homes a year earlier. At the current sales rate, the estimated pending months’ shadow supply is 3 months, up from roughly 2 months a year ago. The combined inventory (visible and pending supply) was 5.5 million homes in September 2009, down from 5.7 million a year ago. The pending supply in combination with high levels of negative equity (23 percent of all residential properties with mortgages as of September 2009) is a significant risk for future home price stability in 2010.

"We are continuing to see improvements in the year-over-year home price change as prices have remained relatively stable since April," said Mark Fleming, chief economist for First American CoreLogic. "The additional government support for the housing market has stimulated demand and restricted supply in 2009. How these government supports are removed in 2010 and the moderation of pending inventory and negative equity will be critical to the continued stability of the housing market (more)."

*September’s decline was revised downward from –9.8 percent to –9.5 percent to reflect updated public record data. Revisions with public record data are standard, and to ensure accuracy, First American CoreLogic incorporates the newly released public data to provide updated results.

Most Current, Most Comprehensive HPI Data

LoanPerformance HPI monthly updates offer the quickest HPI collateral valuation information in the industry—complete HPI datasets five weeks after month’s end plus key indices for the two weeks after that—and leverage the full authority of First American CoreLogic’s industry-leading real estate databases, covering 6,070 Zip codes, 519 Core Based Statistical Areas (CBSAs), and 898 counties in all 50 states and the District of Columbia.

LoanPerformance National HPI 12 Month Change: - 7.8%, Single Family Combined Series, October 2009

Source: First American CoreLogic, LoanPerformance HPI, Single-Family Combined (Detached and Attached) as of October, 2009.

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