Industry News

U.S. home-price index down 3.1%

OFHEO numbers may understate declines in some markets

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Nationwide home prices are down a record 3.1 percent from a year ago, according to a government house-price index that excludes mortgages too large or risky for purchase or guarantee by Fannie Mae and Freddie Mac and may understate price declines in some markets. The Office of Federal Housing Enterprise Oversight said its seasonally adjusted purchase-only house-price index fell by 1.7 percent during the first quarter, and is down 3.7 percent since national home prices hit an April 2007 peak. The 3.1 percent year-over year decline is the largest in the 17-year history of the index, OFHEO said. When inflation is factored in, the price declines are even more severe. With inflation running at 4.6 percent between the first quarters of 2007 and 2008, the 3.1 percent decline in the purchase-only index translates into an inflation-adjusted 7.7 percent. The purchase-only index, which is based on 5 million repeat sales transactions, showed prices falling in 43 states from the pre...