Home prices fall nationwide, and in Seattle, in 3Q

A real estate group says home prices fell in eight out of every 10 U.S. cities in the third quarter of this year as heavily discounted distressed sales made up 30 percent of all deals.

But home sales continued their climb, with quarterly sales outpacing the second quarter and the previous year's figures, the National Association of Realtors said Tuesday.

The median sales prices of existing homes declined in 123 out of 153 metropolitan areas, including Seattle, compared with the same period a year ago. Prices rose in the other 30 cities.

The national median price clocked in at $177,900, or 11 percent below the third quarter last year.

In the Seattle-Tacoma-Bellevue metropolitan area the median was $321,500, down 8.1 percent from a year earlier.

"The decline in the national median price has moderated recently, and a shrinking supply of unsold inventory suggests we are getting closer to price stabilization in many areas, " said Lawrence Yun, the group's chief economist, in a statement. "But we need a steady stream of financially qualified buyers to further reduce inventory and get us to a self-sustaining market."

The federal tax credit of up to $8,000 for first-time homebuyers helped boost sales in the third quarter. U.S. home sales grew in 45 states from the second quarter, with 28 states posting double-digit gains.

Washington was among them. Sales were up 17 percent from the previous quarter and 1.9 percent from a year ago, the National Association of Realtors said.

The Washington Center for Real Estate Research at Washington State University reported similar results in a study also released Tuesday.

It said home sales in the third quarter were up 15.6 percent statewide and 22.5 percent in King County from the previous quarter.

Sales in the county were up 9.7 percent year-over-year, the center said, but the median price dropped 10.5 percent to $382,000.

A special study by the center found that about half the home sales in the state during the April-June quarter were to buyers claiming the federal tax credit, director Glenn Crellin said. Last week's decision to extend and expand the federal program should help the housing recovery, he said.

Seattle Times staff reporter Eric Pryne contributed to this report.