Home Prices Fell in 24 U.S. Metro Areas as Foreclosures Rose

By Brian Louis

Jan. 30 (Bloomberg) -- Home prices fell in 24 of 25 U.S. metropolitan areas in November from a year earlier as the recession and tighter lending spurred record foreclosures.

The San Francisco area saw the biggest drop, with the average price per square foot falling 36.8 percent, New York- based Radar Logic Inc. said in a report today. Phoenix had the next biggest decline, falling 34.6 percent, and Las Vegas slumped 32.4 percent. Milwaukee, Wisconsin was the only area where prices rose, gaining 2.4 percent, Radar Logic said.

Sales of existing homes rose in December, propelled by a 15 percent drop in prices, the National Association of Realtors said on Jan. 26. The number of “motivated sales,” such as foreclosure auctions, helped increase November transactions in 13 metropolitan areas of the 25 Radar Logic tracks.

“Motivated sales just represent houses sold at significant discounts,” Michael Feder, Radar Logic chief executive officer, said in an interview. “You get enough buyers at those prices, you get a floor.”

Four metropolitan areas had their largest monthly price declines since the beginning of Radar Logic’s records, which date to 2000. They were: Charlotte, North Carolina; Denver; San Jose, California; and Tampa, Florida.

Purchases of existing homes rose 6.5 percent to an annual rate of 4.74 million in December from 4.45 million in November, the Realtors said. The median price dropped 15 percent from the previous year to $175,400, the biggest decline since records began in 1968. Foreclosure filings jumped 41 percent in December from a year earlier to 303,410, RealtyTrac Inc. said in a report on Jan. 15.

The RPX Monthly Housing Market Report, published by Radar Logic, measures home values using price per square foot. The data reflects a 28-day aggregate, the company said.

The prices are the basis for property derivatives traded on the Residential Property Index. The index allows investments based on the movement of home prices without owning land or physical property.

To contact the reporter on this story: Brian Louis in Chicago at blouis1@bloomberg.net.