Eisrael Gomez Realtor - Monterey County Blog

According to Dow Jones Business News U.S. home prices fell 0.7 percent in the fourth quarter, according to Standard & Poor’s inaugural release of the national Case-Shiller price index.

This is the fastest rate home prices have fallen since 1992. Overall home prices rose only 0.4 percent last year.

On an inflation-adjusted basis, national home prices are down 1.6 percent in the past year. Prices in the top 10 metro areas are down 2 percent.

Among the 20 cities included in the index, the biggest gains in the past year were in Seattle (up 12.1 percent), Portland (up 9.9 percent) and Charlotte (up 6.7 percent). The biggest losses in the past year were recorded in Detroit (down 5.9 percent), Boston (down 5.1 percent) and San Diego (down 4.2 percent).

You can view historical index data at:

Standard & Poor's Web site,

www.indices.standardandpoors.com

Home Price Indices Factsheet.pdf

How Case-Shiller works

The Case-Shiller indexes attempt to overcome flaws in other measures of home prices by comparing actual arms-length transactions on the same single-family home. New homes and condos are excluded.

Median prices for new and existing homes can be affected by the mix of homes sold. For instance, if relatively more homes are sold in high-priced markets, the median sales price would show an increase even though actual value of any particular home would not have changed.

The quarterly price index reported by the Office of Federal Housing Enterprise Oversight also compares price changes for the same homes, but only covers homes with mortgages that conform to Fannie Mae and Freddie Mac limits, currently $417,000 or less. In addition, the OFHEO index includes mortgage refinancings that are valued by an appraiser, not the market.

The latest OFHEO index showed prices had risen 7.7% year-on-year through the third quarter. For purchases only, the OFHEO index was up 6% year-on-year, the lowest in seven years. Fourth-quarter data will be released Thursday.

Other price indexes are based on the homes sold in a particular period. The median price of a new home was down 1.5% year-on-year through December. The median price of an existing single-family home was down 3.1% in the 12 months ending in January.