The purchase price of U.S. homes fell 4.3 percent in the fourth quarter froma year earlier, as values declined across the country, according to Freddie Mac.
Frank Nothaft, Freddie Mac chief economist, said Monday that low mortgage rates and the fact that foreclosed-property and short sales remain a big part of the market, helped push “homebuyer affordability to levels not seen in decades in most places.”
“This high affordability will likely translate into an increase in 2011 home sales relative to last year,” he said.
The real-estate market has been experiencing a choppy recovery since demand plunged last year when a tax break for first-time home buyers expired.
The mortgage finance giant Monday also said its Conventional Mortgage Home Price Index Purchase-Only Series showed the price of U.S. homes also fell 2.6 percent from the third quarter, without adjusting for seasonality.
Home prices fell in every region of the U.S. The sharpest drops were in the mountain division, states west of Texas but not on the coast, where values fell 4.3 percent on the quarter and 9.6 percent in the last year. The Middle Atlantic — comprising New Jersey, New York and Pennsylvania — saw the mildest declines, at 1.1 percent and 1.7 percent, respectively.
The “classic series” of the data, which includes not only home-purchase values but also appraisals, reported declines of a 0.8 percent on the quarter and a 1.1 percent on the year.
