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Economy in Brief

Home Prices Fell Further
by Tom Moeller May 22, 2008

According to the Office of Federal Housing Enterprise Oversight (OFHEO), home prices in the U.S. declined by 1.7% last quarter. The seasonally adjusted drop was about as expected but it was the third consecutive quarterly decline.That drop was for mortgages for purchase only and excludes those for refinancings.

Price declines in the not seasonally adjusted figure, which includes refinancings, fell a lesser 0.2% (q/q) but the y/y indication of little change in prices represented widespread differences across the country.

Prices in California dropped 4.4% and that marked the sixth consecutive down quarter, a period during which prices fell 11.5%. Prices in Florida fell a sharp 3.3% and it was the fifth consecutive quarterly decline. Over that period prices dropped 8.2%. Home prices fell less far in New Jersey but they were still down 1.2% from the peak one year ago and in New York prices were unchanged last quarter as they have been for roughly a year.

Appreciation in home prices still occurred over the last year in many areas. Prices in Texas haven't yet posted a q/q decline and the yearly gain of 4.7% is exceeded by several states, including Wyoming where prices are up 6.3% y/y. Prices also have been relatively firm in Indiana and in Arkansas, where prices rose 2.1% y/y. Wisconsin, New Jersey and Mississippi (+3.1% y/y) also showed gains in home prices during the last year.

The House Price Indices in this report are weighted indexes based on repeat sales or refinancings using data provided by Fannie Mae or Freddie Mac. The overall figures are available in Haver's USECON data base and the state figures are in the REGIONAL database.

The latest report from the Office of Federal Housing Enterprise Oversight (OFHEO) can be found here.

Falling House Prices and Rising Time on the Market from the Federal Reserve Bank of San Francisco is available here.

House Price Index (OFHEO, %) 1Q '08 4Q '07 Y/Y 2007 2006 2005
United States (Purchase Only, SA) -1.7 -1.4 -3.1 1.8 6.4 9.6
United States (Total, NSA) -0.2 0.3 -0.0 2.7 8.0 11.7
  Texas 0.7 1.1 4.7 6.4 6.2 4.6
  Indiana 1.3 0.4 2.2 2.5 2.2 4.0
  Wisconsin 0.4 0.9 1.8 2.8 4.6 8.2
  New York 0.0 0.9 0.2 2.2 8.0 13.4
  New Jersey -0.5 0.2 -1.2 1.5 9.7 15.9
  Michigan 0.6 0.1 -3.1 -2.7 -0.4 3.8
  Florida -3.3 -1.8 -8.1 -0.6 17.1 25.6
  California -4.4 -2.8 -10.6 -3.3 11.3 23.2
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