Home prices decline but rate of drop continues to improve

National home prices, including distressed sales, declined by 9.8 percent in September 2009 compared to September 2008, according to First American CoreLogic and its LoanPerformance Home Price Index. This was an improvement over August’s year-over-year price decline of 11.1 percent. On a month-over-month basis, however, national home prices dropped by 0.4 percent in September 2009 compared to August 2009, reversing a fivemonth trend of positive appreciation. The August-to-September decline suggests the return of seasonal housing price patterns.

In Lee County, home prices, including distressed sales, declined by 17.6 percent in September 2009 compared to September 2008. This compares to August’s yearover year HPI which was down 17.18 percent.

The index is projecting that 12-month appreciation for Cape Coral-Fort Myers home prices, including distressed sales, will be 5.64 percent.

Forecast shows rebound in spring

The new First American CoreLogic HPI Forecast anticipates continued declines in most markets, albeit at a slowing rate, for the next six months, followed by a rebound in the spring. Above-average levels of foreclosures, inventories and unemployment will continue to take their toll in many major metropolitan markets in the short term. As the economy continues to improve and these factors improve, the forecast calls for housing prices to bottom for most markets by March and then turn positive. This would yield the first positive year-overyear house price appreciation since the beginning of 2007. In September 2009, the forecast is projecting that 12-month appreciation for national home prices, excluding distressed, will be 1.1 percent, bringing price levels for that segment of the market back to levels in May 2004. 