Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Home prices see biggest drop in 25 years

Housing values fall 1.3 percent nationwide in the third quarter, according to a Freddie Mac survey.

Subscribe to Real Estate
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)

NEW YORK (CNNMoney.com) -- National home prices showed their biggest quarterly drop in 25 years during the third quarter of 2007, said a report Tuesday.

Freddie Mac's (Charts, Fortune 500) home price index fell 1.3 percent on an annualized basis in the quarter, according to its survey of home purchases and mortgage refinance appraisals.

"The number of home sales fell during the third quarter, and the inventory of existing single-family homes for sale rose to 10.5 months by October, the highest level since 1985," said Frank Nothaft, Freddie Mac's chief economist.

He said that higher mortgage costs and tightened lending standards from banks had added to the challenge of buying homes.

Geographically, the Pacific region fell the most at a 5.8 percent annualized rate of decline, said Amy Crews Cutts, Freddie Mac's Deputy Chief Economist, while homes in the West South Central saw strong gains of 4.9 percent.

"The decline in home values occurred broadly across the U.S. The [index] found prices falling in seven of nine regions and in 25 states during the third quarter," said Nothaft.

The rise in the Southwest was attributed to strength in the energy sector over the period.

Freddie Mac's index is constructed from actual sales prices and appraised values of homes whose mortgages are being refinanced. To top of page



Photo Galleries
Super Bowl 50 ads are studded with celebrities The 2016 Super Bowl has rolled out the red carpet for the likes of Helen Mirren, Amy Schumer, Seth Rogen, Steven Tyler and the late, great Marilyn Monroe. More
The women of marijuana These women entrepreneurs and executives are making their mark in the marijuana industry. More
Most expensive collector cars from the Scottsdale auctions These are the most expensive collector cars sold at the Scottsdale auctions. More