Outlook for Home Prices May Be Degrading

First American CoreLogic’s Home Price Index shows no change for July 2010 compared to July 2009. However, the number of states with declining prices year-over-year is increasing. The national flat prices have received strong support from strong performances in two large markets: New York and California. If those two huge markets had been flat, the national price level would have been lower. Of course, if the two large markets of Florida and Illinois had been flat, the year-over-year change for the nation would have been positive.

What happens to the national averages will depend more and more on trade-offs of local market changes. The part of the housing decline where 90% of the country is in sync is probably over.