(Updates to add quotes, more findings and other details) By Sarah N. Lynch Of DOW JONES NEWSWIRES WASHINGTON -(Dow Jones)- U.S. home prices fell a seasonally-adjusted 1.8% in the third quarter from the previous quarter, according to a purchase-only house price index published Tuesday by the Federal Housing Finance Agency.
That figure represents the largest decline in the 17-year history of the purchase-only index. It's also a steeper drop from the prior quarter, when home prices fell a seasonally-adjusted rate of 1.4%.
Over the past year, as the housing crisis has worsened, prices fell 6.0% between the third quarter of 2007 and the third quarter of 2008. The purchase-only index represents data from repeat home sales.
"The impact of foreclosures and tightening credit conditions weighed heavily on house prices in the third quarter," said FHFA Director James B. Lockhart.
Lockhart said he hopes that a new foreclosure prevention effort unveiled earlier this month in conjunction with the U.S. Treasury, the Federal Housing Administration, Fannie Mae, Freddie Mac and HOPE NOW will help provide some relief.
"Recent government actions to stabilize financial markets are aimed at countering the tight credit conditions affecting housing," he said.
In addition to the latest data for the purchase-only index, the FHFA also unveiled some grim figures from its "all-transactions" house price index, which includes data from home sales and appraisals for refinanced homes.
The agency said that the index was down 2.7% in the latest quarter and down 4.0% over the four-quarter period. That four-quarter drop was also the largest drop in the history of the index, which dates back to 1975.
In its purchase-only index, the FHFA found that prices fell in 41 states in the latest quarter. Nevada, California and Arizona were hit particularly hard, with those states seeing more than a 5% quarterly drop in prices. Eight other states, meanwhile, saw their quarterly home prices decline by more than 3%.
Of the 20 ranked cities with the greatest price declines over the past four quarters, all but one were located in either California or Florida, the all-transactions house price index found.
The FHFA noted that while the national purchase-only house index price fell 6% between the third quarter of 2007 and 2008, the prices of other goods rose 6.7%. That translates into an inflation-adjusted home price drop of 12.7% over the last year.
"Prices continued their retreat in most areas in the third quarter," said FHFA Chief Economist Patrick Lawler. "While housing affordability has improved and may have drawn in some new buyers, it seems that high inventory levels and buyer uncertainty have had the dominant impact on prices."
Both the FHFA's purchase-only and all-transactions house price indices track average house price changes in repeat sales or the refinancing of the same single-family properties. The purchase-only index is based on more than 5 million repeat sales transactions. The all-transactions index includes about 36 million repeat transactions. Both indices are based on data obtained from Fannie Mae and Freddie Mac for mortgages originated over the past 34 years.
-By Sarah N. Lynch, Dow Jones Newswires; 202-862-6634; sarah.lynch@dowjones.com
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(END) Dow Jones Newswires
November 25, 2008 12:18 ET (17:18 GMT)

Publié le 25 novembre 2008 Copyright © 2008 Dowjones