Two separate industry gauges released recently indicate that despite the ups and downs seen in monthly reports on home prices over the last year, residential property values ended 2010 relatively unchanged from 2009 levels.
Reports from both Integrated Asset Services (IAS) and CoreLogic point to level ground over the 12-month period, although consecutive month-to-month declines were the dominant pattern during the latter part of the year.
IAS says one hopeful sign for real estate arrived in a report from the private research group the Conference Board that showed consumer confidence in January climbed to its highest level in eight months as Americans became more optimistic about job prospects. Moreover, the share of people who said they intended to buy a home rose to 2.2 percent, the second consecutive gain after November’s 1.7 percent.
IAS stressed, however, that the burning question now is whether an improving consumer outlook will be offset by the drag from rising mortgage rates and the glut of distressed properties for sale. Many believe the enormous supply overhang of existing homes, particularly when considering all those in or soon to be in foreclosure, promises to keep pressure on prices for some time.
CoreLogic says it’s reading the data as “a sign that the largest declines are over,” considering the company recorded double-digit drops in residential property values in both 2008 and 2009.
Mark Fleming, CoreLogic’s chief economist, said “Despite the continued monthly decline in home prices and year-over-year depreciation, we’re encouraged that on an annual basis we’re unchanged relative to a year ago.”
The number of price-reduced homes on the market in December 2010 fell by 7.7 percent from the previous month, according to a survey of 26 major U.S. markets conducted by the national real estate brokerage ZipRealty.
Despite the month-to-month decline, the company says the number of homes with a reduced asking price remained high compared to a year earlier, rising 23.4 percent from December 2009.
ZipRealty’s report shows that in nine of the 26 markets included in its study, more than half of the homes for sale in December 2010 included at least one price reduction.
The report also found that in the markets surveyed, the median list price in December was down 3.9 percent at
$225,434, compared to November when the median list price was over $9,000 higher at $234,484.
According to ZipRealty’s 26-market analysis, the percentage of total housing inventory that has experienced at least one price reduction dropped for the first time in months, decreasing to 47.2 percent in December. That’s down from 48.4 percent in November and 48.3 percent in October of 2010.
December is traditionally a slow month for home sales, and this could be a contributing factor to the decline over the previous two months in inventory as well as the drop in median list price.