U.S. home prices fell 5.7 percent in February from a year earlier as distressed properties weighed down values, according to the Federal Housing Finance Agency.
The decline was led by a 12 percent slump in the region that includes Colorado and Nevada, followed by an 8.7 percent retreat in the area that includes California and Oregon, the agency said today from Washington. Nationally, prices slid 1.6 percent from January, more than the 0.3 percent drop that was the average estimate of 18 economists in a Bloomberg survey.
Home values are dropping as foreclosures undermine real estate prices. The share of homes sold in March that were distressed properties, meaning foreclosures or short sales, rose to 40 percent from 39 percent in February, the National Association of Realtors reported yesterday. There were 2.2 million homes in foreclosure in March, up 1.4 percent from a month earlier, Lender Processing Services Inc. in Jacksonville, Florida, said in a statement this week.
“The increasing share of distressed sales will continue to exert downward pressure on home prices because they sell at a discount,” Michelle Meyer, a senior economist at Bank of America Merrill Lynch Global Research in New York, said yesterday in an interview on Bloomberg Television’s “Bottom Line” with Mark Crumpton.
Fannie, Freddie Mortgages
The FHFA measures transactions of homes financed with mortgages backed by Fannie Mae or Freddie Mac. The data are based on repeat-sales transactions that compare prices of the same properties over time. The report measures changes in values without providing a specific sales price.
The median U.S. price for a previously owned home sold in February was $156,100, a nine-year low, according to the National Association of Realtors. It rose in March to $159,600, the Chicago-based group reported yesterday. The March median price was 5.9 percent below a year earlier, the biggest year- over-year decline since October 2009.
Sales of U.S. previously owned homes rose 3.7 percent in March to a 5.1 million annual rate, according to the National Association of Realtors’ report. That’s down 21 percent from November 2009’s pace of 6.42 million, when purchases were fueled by a federal homebuyer tax credit.
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