Fiserv Case-Shiller Home Price Insights: U.S. Housing Prices Forecast to Decrease 11 Percent over the Next Yearhttp://finance.yahoo.com/news/Fiserv-CaseShiller-Home-Price-bw-3674401879.html?x=0&.v=1BROOKFIELD, Wis.--(BUSINESS WIRE)--Fiserv, Inc. (NASDAQ:FISV - News), the leading global provider of financial services technology solutions, today released an analysis of home price trends in more than 375 U.S. markets based on the Fiserv Case-Shiller® Home Price Index, which is owned and generated by Fiserv, and data from the Federal Housing Finance Agency (FHFA).
The U.S. housing market continued its price correction, with single-family home prices across the U.S. falling an average of 14 percent over the 12-month period ending June 30, 2009. The Fiserv Case-Shiller Home Price Index forecasts that average single-family home prices will fall another 11 percent over the next twelve months, with declines expected in about 90 percent of the more than 350 metro areas tracked by Fiserv. Steep home price declines are expected to continue in markets that have been hurt most by the housing crisis, including metro areas in California, Nevada, Arizona and Florida.
“Large supplies of foreclosed properties and extremely weak job markets will continue to put downward pressure on home prices,” said David Stiff, chief economist, Fiserv. “Many temporary factors that were partly responsible for strong spring and summer real estate markets, including the first-time homebuyer tax credit and Federal Reserve actions to drive down mortgage interest rates, will no longer be bolstering demand. Consequently, home prices will resume falling again before they stabilize in 2010.”
While falling home values in areas mentioned are expected to drag down the national average, housing prices have shown signs of life in other markets. U.S. single-family home prices increased by 1.4 percent in the second quarter of 2009 (on a seasonally adjusted basis), the first gain since early 2006.
Prices increased in many markets that earlier experienced dramatic price declines, including Washington, D.C., San Francisco, and Naples, Florida. Metro areas with high volumes of foreclosure activity, such as Memphis, Tenn. and Minneapolis, Minn., also had solid price gains as investors and homebuyers went bargain hunting.
“The second quarter bounce in home prices is good news, since it shows that prices have dropped enough to draw buyers back into many markets, many of these first-time homebuyers,” said Stiff. “The second quarter increase in sales activity and prices indicate that confidence is returning to real estate markets, setting the stage for price stabilization and, eventually, a housing market recovery.”
Nationally, home prices have fallen almost 15 percent over the past year, leaving the median price at $174,000. The median monthly mortgage payment in the 2009 first-quarter remained steady at 14 percent of median family income.