Some Price Stabilization Seen in National Real Estate Market

Buyer, Seller, Real Estate News

We may be seeing the first step in the "bottoming" of the market as reported by the quarterly forecast for mortgage risk by First American CoreLogic.

In this first chart below we can see that the House Price Appreciation Trend (or depreciation trend in recent years) has started to reach an almost "flat line". Should this trend continue then would it seem to indicate the dropping in home values has stabilized. This chart indicates that current values are approximately 11% below last year.

The second chart below shows that the recent value of homes are back at the 3rd Quarter of 2004 level. This significant drop in house values should allow a larger part of the buying population to afford to buy homes. This would eventually lead to a removal of the excess inventory of homes over time and eventual stabilization of the market.

The 3rd chart show that the acceleration in the loss of value is slowing. Although we are not there yet, for the past two quarters we have been trending towards the 0% which would be a stabilization in the drop in values of the real estate market.

In summary, we still have a while to go before we do see a market bottom but the provided forecast show that we may be started in that direction with the pace of decline in the value of the housing market slowing.

Source: http://www.loanperformance.com/riskmonitor/Q3-2008_CMRM_final_082608.pdf