BROOKFIELD, Wis.-A new analysis of the 375 U.S. markets in the Fiserv Case-Shiller Index found that during the fourth quarter of 2009, U.S. home prices were up in 155 out of 384 metro areas, including markets in California, Ohio, Michigan and Washington.
However, despite the positive performance in these regional markets from recent lows, average U.S. home prices were down 2.5% from Q4 2009, which can be attributed to the continued high level of unemployment, rising interest rates and the large number of distressed properties that remain in markets such as Florida, Arizona and Nevada, according to Fiserv.
"The first-time homebuyer tax credit has expired, the Federal Reserve has stopped buying residential mortgage backed securities (MBS) and the projected number of foreclosures remains extremely high," Fiserv said in its analysis. "As a result, markets with recent price increases may see small price declines before prices finally stabilize at the end of this year or early 2011."
The analysis found that over the past year, the U.S. housing market continued its price correction, with single-family home prices across the U.S. falling an average of 2.5% over the 12-month period ending Dec. 31, 2009. The Fiserv Case-Shiller Indexes forecast that average single-family home prices will fall another 3.1% over the next 12 months. Steep home price declines are expected to continue in markets that have been hurt most by the housing crisis. From the fourth quarter of 2009 through the fourth quarter of 2010, average home prices in Nevada, Arizona and Florida are projected to decline 9.2%, 9.5 % and 7.7% , respectively.
At the end of 2009, the median U.S. home price was $170,300. The median monthly mortgage payment in the 2009 fourth-quarter fell slightly to 14% of median family income, a decrease of 1% over the third quarter.
Among the other findings:
• California markets collapsed about one year before much of the rest of the U.S. Relative to bubble-era prices, these markets have seen the greatest improvement in housing affordability.
• In Washington, home prices were up 5.2% year-over-year.
• Ohio and Michigan are seeing signs of stabilization.
