Las Vegas has posted its first quarterly increase in housing prices in three years and Detroit led all U.S. metropolitan areas in housing price gains for the second consecutive month, as some of the nation’s most battered housing markets are showing signs of stability.
Figures released today by Clear Capital, a real estate data company, show that Las Vegas –area housing prices rose 1.1 percent in the last quarter of the year, it’s first increase since housing markets began to collapse in 2006. Meanwhile, the Detroit metropolitan area posted a 17.4 percent gain over the last three months, following an increase of 14.4 percent last month in Clear Capitals rolling quarterly survey.
Both have been among the nation’s hardest-hit cities in the ongoing real estate crisis. Housing values in Las Vegas are down 63.7 percent from their peak at the top of the market. Current gains in both cities were attributed to rising prices for foreclosed properties, which make up about half of all homes sold in each.
National prices down slightly in 2009
On a national basis, home prices averaged a 1.7 percent increase over the last quarter of the year, which limited the annual decrease for 2009 to a relatively flat 1.3 percent.
"After watching home prices plummet the past three years, it is encouraging to see the year close with minimal price declines," said Kevin Marshall, Clear Capital president. "The stronger positive gains we saw this summer have softened into the fall and early winter, but it's good to see that they've remained in positive territory.”
Six worst-performing markets now among the best
Six of the top 15 performing major markets in the current survey were among the bottom 15 performers in the final quarterly survey of 2008 - Atlanta Ga.; Minneapolis, Minn.; Phoenix Ariz.; Riverside, Calif.; San Francisco, Calif.; and San Jose, Calif. The report attributes the volatility in these markets to wide price swings for foreclosed properties, which in the last quarter represented one-fourth to one-half of home sales in those markets.
Seven of the top 15 performing metropolitan areas also showed annual price increases as well, and all posted quarterly increases of at least 2.5 percent. That’s in contrast to one year ago, when 14 of the top 15 markets actually showed quarterly decreases, and none posted increases for 2008.
The report credits a reduction in foreclosed properties as a percentage of total sales for helping to drive prices up nationally during summer months. The saturation rate for real-estate owned (REO) properties fell from 41.5 percent in the first quarter of 2009 to 25.5 percent in the final quarter of the year, which the report attributed in part to loan modification programs that have helped moderate the supply of foreclosed properties coming on the market.
The Clear Capital Home Data Index market report is a monthly survey of housing sales prices in major U.S. metropolitan areas that uses a rolling quarterly method to report results. That is, survey results for the past three months are averaged to produce a quarterly figure, with results updated monthly.
