U.S home prices saw a year-over-year decline of 2.6% last month, according to new data from Truckee, Calif.-based Clear Capital. The drop was attributed, in part, to what Clear Capital called ‘market seasonality’ and an increase of real estate owned sales as a percentage of total home sales, from 24.8% at the end of 2011 to 25.4% at the end of January.
Alex Villacorta, director of research and analytics at Clear Capital, warns that declining home prices in the Midwest are creating a drag on national housing data.
‘Looking at the latest data through January, home prices remained relatively unchanged with the exception of the Midwest,’ says Villacorta. ‘Although prices at the national level continue to slide due to pressure from the Midwest, the lower priced segments of several specific markets are bucking the trend and seeing appreciation, suggesting that recoveries could be occurring from the bottom up. When we look at the strength in the bottom tier of prices, the volatility within the metro markets, the rapid changes in direction with certain regions, and relative stability in others, these factors underscore the economic and market fragility that remains a dark cloud over housing prices.’