Study Reveals Main Culprit Behind Falling Home Values
Daily Real Estate News | Friday, February 03, 2012
Blame it on distressed sales for falling home values, according to CoreLogic’s December Home Price Index.
Home prices nationwide dropped nearly 5 percent from 2010 to 2011, but if you exclude distressed sales, prices dropped only by 0.9 percent, according to CoreLogic.
Foreclosures continue to hamper neighboring property values.
“Until distressed sales in the market recede, we will see continued downward pressure on prices,” Mark Fleming, chief economist of CoreLogic, told AOL Real Estate.
The states that saw home prices decline by the largest amounts since the housing peak are Nevada, Arizona, Florida, Michigan, and California. All five states have a high rate of foreclosures too. Nevada, which has the highest foreclosure rate in the country for the last several years, saw home values fall 60 percent since the peak.
Source: “Distressed Sales Undercut Home Prices in 2011, Study Says,” AOL Real Estate (Feb. 2, 2012)