U.S. quarter-over-quarter home prices have slowed their descent, while year-over-year price gains remain steady at 5.1%, according to the latest Home Data Index market report from Clear Capital.
Additionally, the increase in the nation's real estate owned (REO) saturation rate slowed in April, rising less than one percentage point to 29.6%.
According to Alex Villacorta, Clear Capital's senior statistician, market data show that the nation's best-performing metro areas are absorbing fairly high levels of distressed inventory with little, if any, negative impact on home prices.
‘For example, the highest-performing metro areas have seen prices remain relatively flat over the last quarter despite REO saturation rates averaging just above 33 percent," Villacorta says. "Contrast this with the lowest-performing areas, which have seen prices drop dramatically, with average declines of more than 10 percent and average REO saturation rate less than those in the highest-performing areas."
‘This paradox suggests that price trends are not wholly dependent on distressed sale volume and reinforces the need to understand local market trends,’ he adds.
Quarter-over-quarter home prices continue to slide across all four regions of the nation. Nationally, the 5% percent price decline represents a further 1.1 percentage point reduction from the quarterly decline reported last month. The pace is a marked slowdown in decline compared to the 3.9 percentage point drop seen between the reports released in early March and April of this year, Clear Capital says.
The falling quarterly prices are sufficient to halt the recent growth in year-over-year gains for the center regions of the nation, the firm adds.
The Midwest reached an 11.3% gain for the year, down from last month's 12.8%. Similarly, the South (3.3%) is down from last month's 3.4% yearly gain. The two coastal regions, while maintaining quarterly declines, still managed to add to their yearly gains. The West (4.6%) added a 2% price increase, while the Northeast (2.2%) added 0.1% over last month.
SOURCE: Clear Capital