Home prices in 25 metropolitan areas fell 3.4% YoY in October, a deeper deflationary trend than the -2.5% in September (and a swing from +2.2% YoY a year ago and the 18% peak in 2005), according to the RPX home price index published by Radar Logic. 20 of the 25 cities in the survey showed outright
deflation. This compares to a 6.1% YoY decline reported by the Case Shiller (CS)20-city index. The RPX survey is more expansive than CS as it includes more cities (25 vs. 20 for CS) and also includes sales of multi-unit dwellings (i.e.condos and coops) and sales prices of new homes too (though one of the drawbacks of RPX is that it does not use a matched sale methodology and so is subject to shifts in sales from high-price regions to low-priced regions). In general all the price indexes continue to point to deflation in the housing market that shows no sign of abating. We continue to look for at least another 10% decline in home prices in 2008.
.
