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Feb-18-2010 10:03printcomments

December Home Price Index Shows Narrowing Decline, Slowed Recovery

New report from First American CoreLogic shows home Prices Exhibit "Improving Declines".

Aerial view of Salem, Oregon
Aerial view of Salem, Oregon by Tim King

(SALEM, Ore.) - National home prices, including distressed sales, declined by 3.7 percent in December 2009 compared to December 2008, according to First American CoreLogic and its Loan Performance Home Price Index (HPI).

This was a significant improvement over November's year-over-year price decline of 5.3 percent.* Excluding distressed sales, year-over-year prices declined in December by 3.3 percent; and in November the non-distressed HPI fell by 5.0 percent year-over-year. This improvement is taking place as the real estate market is getting further from the period of peak distress in home prices. On a month-over-month basis the national average of home prices declined moderately, falling by 1.0 percent in December 2009 compared to November 2009, indicating seasonal slowing in a fledgling housing recovery.

The peak-to-trough decline (from April 2006 to March 2009) for the national index including distressed sales has been revised from -34.2 percent to -31.8 percent based on additional data included.**

Forecast Shows Continued Short-term Declines

First American CoreLogic's forecast continues to project declining house prices into the spring months. The national HPI is projected to fall an average of 4.4 percent through April 2010, as high levels of unemployment, housing inventories and foreclosures continue to exert downward pressure on prices. The forecast indicates that April will be a critical month for the housing market, given the current scheduled expiration of the federal homebuyer tax credit.

While the tax credit provided some significant support to house prices in 2009, the forecast model currently indicates that the future path of house prices after April will be significantly impacted by whether the tax credit is allowed to expire or is once again extended.

Nationally, the HPI 12-month forecast is expected to be up 3.5 percent excluding distressed sales; and up 2.7 percent including distressed sales by December 2010.

Home Prices in Salem Decrease

In Salem, home prices, including distressed sales, declined by 8.22 percent in December 2009 compared to December 2008. This compares to November's year-over-year HPI, which was -8.77 percent.** Excluding distressed transactions, year-over-year HPI for December is -5.87 percent, compared to November which was -7.50 percent.

First American CoreLogic is projecting that 12-month forecast for Salem home prices, including distressed sales, will be -0.26 percent.

National HPI Highlights as of December 2009

* Including distressed transactions, the peak-to-current change in the national HPI (from April 2006 to December 2009) is -28.2 percent. Excluding distressed properties, the peak-to-current change in the HPI is -21.5 percent.

* When distressed sales were included, Nevada (-20.8 percent) remained the top-ranked state for annual price depreciation in December, followed by Arizona (-12.6 percent), Idaho (-11.4 percent), Florida (-11.3 percent) and Michigan (-10.8 percent). Of these five states, all but Michigan showed month-over-month decreases in their HPI between November and December 2009.

* Excluding distressed sales, the worst five states for year-over-year price declines changes slightly. Nevada (-18.8 percent) still holds the top spot, followed by Arizona (-11.8 percent), Florida (-10.3 percent), Michigan (-10.0 percent) and Maine (-9.1 percent).

"The housing market, after experiencing stabilization in many, but not all, markets in the spring and summer of 2009 is going through the typical seasonal winter malaise," said Mark Fleming, chief economist for First American CoreLogic. "The big unknown for the 2010 spring selling season continues to be the future of the federal home buyer tax credit," he said.

December HPI for the Country's Largest Core Based Statistical Areas (CBSAs):

CBSADecember 2009 12 Month HPI
Change by CBSA
12 Month Forecast
(December 2009 - December 2010)
Single Family CombinedSingle Family Combined Excluding DistressedSingle Family CombinedSingle Family Combined Excluding Distressed
Washington-Arlington-Alexandria, DC2.1%1.2%0.3%3.3%
Dallas-Plano-Irving, TX1.9%0.9%0.3%1.1%
Boston-Quincy, MA1.1%-1.7%1.6%3.1%
Houston-Sugar Land-Baytown, TX0.9%-0.6%2.7%3.2%
Philadelphia, PA-3.1%-3.3%1.3%1.1%
Atlanta-Sandy Springs-Marietta, GA-3.4%-4.6%0.1%-0.8%
Los Angeles-Long Beach-Glendale, CA-3.9%-3.9%3.1%3.3%
New York-White Plains-Wayne, NY-NJ-8.5%-6.9%0.6%3.2%
Chicago-Joliet-Naperville, IL-8.6%-8.4%3.2%3.9%
Miami-Miami Beach-Kendall, FL-9.4%-7.4%1.7%3.7%

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

December HPI State and National Ranking:

StateDecember 2009 12 Month HPI
Change by State
12 Month Forecast
(December 2009 - December 2010)
Single Family CombinedSingle Family Combined Excluding DistressedSingle Family CombinedSingle Family Combined Excluding Distressed
National-3.7%-3.3%2.7% 3.5%
West Virginia-8.6%-6.9%3.7%3.0%
New Jersey-7.1%-6.6%0.5%4.4%
New York-5.4%-3.6%1.4%2.1%
South Carolina-4.3%-4.3%2.3%2.4%
New Mexico-3.3%-2.5%1.9%3.4%
North Carolina-3.0%-3.0%1.2%0.2%
District of Columbia-2.1%2.4%2.8%4.0%
Rhode Island0.6%-5.4%0.3%1.1%
North Dakota1.9%2.2%3.4%5.0%
New Hampshire2.2%-0.8%0.7%2.8%
South Dakota2.8%3.2%4.0%2.6%

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

12 Month HPI Change

12 Month HPI Change

* November's decline was revised downward from -5.7 percent to -5.3 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.

** The database has been expanded to include additional records, and as a result, the LoanPerformance HPI historical data has been revised accordingly.


The First American CoreLogic LoanPerformance HPI incorporates more than 30 years worth of repeat sales transactions, representing more than 55 million observations sourced from First American CoreLogic's industry-leading property information and its LoanPerformance securities and servicing databases. The LoanPerformance HPI provides a multi-tier market evaluation based on price, time between sales, property type, loan type (conforming vs. nonconforming), and distressed sales. The LoanPerformance HPI is a repeat-sales index that tracks increases and decreases in sales prices for the same homes over time, which provides a more accurate "constant-quality" view of pricing trends than basing analysis on all home sales. The LoanPerformance HPI provides the most comprehensive set of monthly home price indices and median sales prices available covering 6,070 ZIP codes (58 percent of total U.S. population), 519 Core Based Statistical Areas (CBSA, 85 percent of total U.S. population) and 898 counties (81 percent of total U.S. population) located in all 50 states and the District of Columbia. Full-month December 2009 state-level and top CBSA-level data can be found at

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