Industry News

Top metro areas face home-price declines

Report: Strong economy expected to balance risk

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Forty-eight of the nation's 50 largest metropolitan statistical areas face a greater risk of declining home prices this quarter, but the continued strength of national and local economies suggests that in the absence of an economic shock, the once red-hot housing market will cool gradually, an industry report found today. House-price appreciation has slowed in nearly half of the metropolitan statistical areas compared with last quarter, according to PMI Mortgage Insurance Co.'s latest risk index. Affordability remains a problem with eight metro areas registering affordability levels considered low by historical standards, due to appreciation and higher interest rates. In a separate study of the past value of home ownership, PMI found that between 1986 and 2005, owning a home in one of the largest metro areas resulted in a positive return on investment, with the chance of a positive return increasing the longer the home was owned. The study was based on the home-price index tracked b...