Home Prices Retreat to Circa 2003 as Foreclosure Pressures Persist: IAS
05/11/2011
Integrated Asset Services (IAS) says its latest market analysis indicates the size and scope of home price declines are accelerating across the nation.
The Denver-based default management and valuation firm’s IAS360 House Price Index (HPI) fell another 2.6 percent over the first three months of 2011.
IAS says with the first-quarter decline, U.S. house prices are now down more than 25 percent from their high-water mark touched four years ago. At the end of March, the IAS360 was standing at a level not seen since the second quarter of 2003.
The company says foreclosures, meanwhile, are expected to rise to 1.2 million this year, adding to an already engorged housing supply and exerting further downward pressure on property values.
“There are simply too many market factors weighing against house prices to correct the supply and demand gap in the near term,” said Paul Sveen, CEO of Integrated Asset Services.
“Even if the economy is normalizing a bit, I just don’t see any of the problems overhanging the housing market going away any time soon,” Sveen said.
IAS reports that virtually every key measure of its home price analysis declined during the first quarter, including all four U.S. census regions, all nine census divisions, and all of the IAS360’s largest metro regions.
The continued slide has pushed both Las Vegas and Miami down more than 50 percent from the top of the market in 2007.
Even the nation’s wealthier areas took a turn for the worse this period, with eight of the IAS benchmark’s ten wealthy counties reporting first-quarter declines. All were positive the previous period.
“We look at the housing market all the way down to the neighborhood,” said Sveen, “and there’s just nothing good to see in this report. I have very real concerns the U.S. housing market is on its way to a new low.”
Leading the way down this period were outsized price declines in the two North Central divisions that comprise the Midwest census region, according to IAS’ study.
With the Chicago metro area dropping 4.6 percent, the overall region fell a stunning 6.9 percent for the quarter — this following a slight gain the previous period.
Similarly, the Northeast and West regions also turned negative, falling 3.2 percent and 3.7 percent respectively. The South slid another 2.0 percent.
The West region, which includes three of the nation’s hardest hit states — California, Arizona, and Nevada — is down nearly 40 percent from its high four years ago, according to IAS.
IAS data includes non-conforming, bank-owned, and conventional sales transactions, in addition to those insured by federal government agencies.
SOURCE: DSNEWS.COM
