Home prices in 25 metro markets tracked by analytics firm RadarLogic in its RPX Composite index declined by 3.8% in 2010, the firm reported.
Stability in home prices during the beginning of 2010 was attributed to stimulus of the housing market that came via the government’s homebuyer tax credits, low-down-payment Federal Housing Administration loans, and the Federal Reserve’s purchase of $1.25 trillion in mortgage-backed securities and $175 billion of housing agency debt, which helped keep mortgage rates near record lows.
When the stimulus ended mid-year, weakness returned to housing markets.
On a month-over-month basis, the RPX Composite price performed worse than its 10-year average in 10 of 12 months in 2010. On a year-over-year basis, the performance of the RPX Composite price through Dec. 31 was worse in 2010 than in any other year save for the bust years of 2007 and 2008.
The RPX Composite prices for the Midwest, West and South in 2010 each declined in excess of 5% from one year earlier. The RPX Composite price for the Northeast outperformed the prices for the other regions, declining just 1.5%. The Northeast price is heavily influenced by housing market dynamics in the New York metropolitan area, where home prices fared better than most other parts of the country.
In 2010, REO sales increased from 26% to 31% of total sales throughout the 25 metropolitan areas tracked by Radar Logic. Twenty-two of the metropolitan areas exhibited a year-over-year gain in REO sales’ share of total sales.