Homes here worth less than in '07

NEW YORK — The average Seattle-area home price fell year over year for the first time since 1991, according to a home-price index of 20 cities released Tuesday.

Prices dropped 1.3 percent in January compared with the same month a year earlier, the Standard & Poor's/Case-Shiller index showed.

While that stung area home sellers, others across the nation fared much worse.

U.S. home prices fell 10.7 percent in January from the same month last year, according to the index, which showed the steepest decline in its two-decade history. The index measures the average change in the prices of same-quality homes in 20 major metropolitan areas.

The Northwest Multiple Listing Service had reported that in December, King County prices declined year-over-year for the first time in recent history, to $435,000. Prices have since slid further.

The two reports cover different geographic areas, and the MLS report focused on the median single-family house price, not an average, as the new report does. The median price is the point where half the homes sell for more, half for less

According to Tuesday's report, which does not cite dollar figures, only Portland had a smaller annual decline than Seattle — 0.5 percent

Worst-hit were Las Vegas and Miami, both reporting 19.3 percent drops, as those regions are still paying the price for rampant speculation and overbuilding during the boom years. Those cities and 14 others — including Phoenix, San Diego and Detroit — posted record drops.

"I wouldn't be looking for a pattern of improvement until April, May or June," said Brian Bethune, Global Insight's chief U.S. economist.

Only Charlotte, N.C., gained in the Case-Shiller index, with a 1.8 percent increase in January compared with a year earlier.

Another housing-market indicator, released Monday, showed the median price of existing homes sold in February fell in the largest year-over-year drop since at least 1999.

"Home prices continue to fall, decelerate and reach record lows across the nation," said David Blitzer, index committee chairman at S&P. "No markets seem to be completely immune from the housing crisis."

All 20 cities S&P tracks have seen falling prices for five consecutive months when compared, Blitzer said. What's more, the declines are growing in severity, with 13 of the cities reporting their biggest single monthly decline in January.

Seattle's prices dropped 1.8 percent from December to January, the same percentage change as Atlanta and Dallas. The highest one-month loser was Las Vegas, which saw prices tumble 5.1 percent.

Pava Leyrer, president of Heritage National Mortgage in Detroit, said the tightening of loan standards has compounded the problems of too much inventory, foreclosures and worries over the economy.

"It's just a spiral that will end up taking this year to get out of," Leyrer said.

While the vast majority of homes are not in danger of foreclosure, the housing slump has raised concerns about a recession and has had ripple effects across the economy as consumers spend less in other areas.

Consumer confidence sank to a five-year low in March as tight credit markets, rising prices and worsening job prospects deepened worries of a recession. The Fed has aggressively slashed interest rates to spur growth and free up the credit markets.

A separate survey released Tuesday by the Office of Federal Housing Enterprise Oversight said home prices nationwide fell 3 percent in January from the same month last year, and fell 1.1 percent from December. The declines were sharpest in New England.

That index is calculated using mortgages of up to $417,000 that are bought or backed by government-sponsored mortgage companies Fannie Mae or Freddie Mac. It excludes jumbo loans.

Many sellers in some parts of the country seem to be cutting prices more aggressively. While sales of existing homes notched a surprise increase in February after falling for six straight months, the median price dropped, the National Association of Realtors said Monday.

The trade group said sales rose 2.9 percent last month to a seasonally adjusted annual rate of 5.03 million units — the biggest increase in a year.

But the median price fell to $195,900, the largest year-over-year drop shown in records that go back to 1999.

Seattle Times business reporter Elizabeth Rhodes contributed to this report, which also includes information from Seattle Times archives.