CoreLogic Sees Rerversal of Home Price Gains

By Inman News, Thursday, May 20, 2010

National home prices were up 1.7 percent in March when compared to a year ago, but will probably give back some CoreLogic said in releasing its latest home-price index.

While 51 out of the 100 largest markets saw year-of those gains in the year ahead with the expiration of the federal homebuyer tax credit, data aggregator over-year price appreciation in March — up from 42 markets in February — CoreLogic predicts average national home prices will fall 0.5 percent in the next 12 months.

The road ahead looks much different if distressed properties are excluded, with 3.6 percent price appreciation forecast for national home prices in the year ahead.

“The differences between trends, including and excluding distressed sales, indicate the strong influence of distressed activity remains,” said Mark Fleming, chief economist for CoreLogic.

A surge in March home sales gave the market a boost this spring, but as the influence of the tax credit and spring buying season fade, price growth will fade heading into the summer, Fleming predicted.

Detroit is predicted to have the largest price depreciation in the next 12 months (-6.1 percent), followed by Seattle (-4.1 percent), Nassau-Suffolk, N.Y. (-3.4 percent) and Baltimore (-3.3 percent).

Metro areas where CoreLogic expects to see the most price appreciation in the year ahead are San Jose (6.8 percent), Buffalo-Niagara Falls (4.9 percent), Denver (4.7 percent) and San Diego (4.4 percent). Most of those price gains are expected to be realized in the spring.

Looking back a year, Idaho remained in first place as the state with the greatest annual price depreciation (-11.1 percent), followed by Nevada (-8.8 percent), Illinois (-8.2 percent), Maryland (-6 percent) and Alabama (-5.6 percent).

Home prices are down 30.5 percent from their April 2006 peak, or 21.5 percent if sales of distressed homes are excluded, CoreLogic said.

CoreLogic revised its previous estimate of year-over-year price appreciation for February, from 0.3 percent to 0.8 percent, to reflect updated public records data.