Freddie Mac Reports Home Values Decline in 3Q

November 30 2010 (Chris Moore)
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Freddie Mac released the results of its third quarter Conventional Mortgage Home Price Index (CMHPI) Purchase-Only Series today and reported that home values declined 1.9 percent for the quarter compared to the second quarter of this year. Home values declined 3.1 percent compared to the third quarter off 2009.

Home values fell in eight of the nine Census Divisions with the New England division being the only area registering an increase.

Amy Crews Cutts, Freddie Mac deputy chief economist stated, “Home sales in the third quarter declined from the second quarter, in part because of the expiration of the home-buyer tax credit. Although sales rose in August and September, the net decline over the quarter was still large. We’re now seeing the effect of the sales slow-down in home purchase prices.”

The CMHPI Purchase-Only Series had the following regional house-price changes:

– New England Division (CT, MA, ME, NH, RI, VT): increased 0.3 percent (1.1 percent, annualized) in the third quarter of 2010. Over the last 12 months, home values decreased 0.5 percent, and during the last five years, home values declined 10.3 percent.

– East South Central Division (AL, KY, MS, TN): fell 0.6 percent (-2.3 percent, annualized) in the third quarter of 2010. Over the last 12 months, home values decreased 1.9 percent, and during the last five years, home values increased 5.6 percent.

– Middle Atlantic Division (NJ, NY, PA): decreased 0.6 percent (2.5 percent, annualized) in the third quarter of 2010. Over the last 12 months, home values decreased 0.6 percent, and during the last five years, home values increased 1.9 percent.

– West South Central Division (AR, LA, OK, TX): fell 0.8 percent (-3.1 percent, annualized) in the third quarter of 2010. Over the last 12 months, home values increased 0.2, and during the last five years, home values increased 13.6 percent.

– East North Central Division (IL, IN, MI, OH, WI): fell 1.7 percent (-6.4 percent, annualized) in the third quarter of 2010. Over the last 12 months, home values decreased 3.6 percent, and during the last five years, home values decreased 10.2 percent.

– West North Central Division (IA, KS, MN, MO, ND, NE, SD): decreased 1.7 percent (-6.7 percent, annualized) in the third quarter of 2010. Over the last 12 months, home values decreased 1.9 percent; over the last five years, home values fell 2.2 percent.

– Pacific Division (AK, CA, HI, OR, WA): fell 2.4 percent (-9.3 percent, annualized) in the third quarter of 2010. Over the last 12 months, home values decreased 2.6 percent, and during the last five years, home values have decreased 20.7 percent.

– South Atlantic Division (DC, DE, FL, GA, MD, NC, SC, VA, WV): declined 3.2 percent (-12.2 percent, annualized) in the third quarter of 2010. Over the last 12 months, home values decreased 6.3 percent, and during the last five years, home values fell 12.0 percent.

– Mountain Division (AZ, CO, ID, MT, NM, NV, UT, WY): decreased 4.9 percent (-18.1 percent, annualized) in the third quarter of 2010. In the last 12 months, home values decreased 8.3 percent; during the last five years, home values declined 13.7 percent.

Amy Crews Cutts also added, “Distressed sales, including foreclosed properties and short sales, are still a big part of the market. The past three quarters we’ve seen encouraging numbers in delinquency trends as reported by the Mortgage Bankers Association, though the delinquency rates remain high. Our forecast is for economic conditions to continue to improve, which should lower delinquency rates further over the coming year and relieve some of the downward pressure on home prices.”

Tags: freddie mac, home values, home prices, foreclosed properties, distressed sales, short sales, delinquency rates, home sales