Home prices in steepest quarterly drop

The plunge in home prices is still continuing. In the last three months of 2007, the drop in prices set a record of highest-ever quarterly drop. The national median price dropped from $219,000 to $206,000, a plunge of 5.8%. According to National Association of Realtors (NAR), this is the steepest drop in prices ever.According to NAR officials, the crunch in the mortgage financing is the main factor for such drop in median prices. Mortgage financing became tough, specially for the jumbo mortgages since last summer. As a result of the liquidity squeeze, lesser number of jumbo mortgages were available which led to lesser transaction in the expensive home section, which in turn brought down the national median price. Expensive markets like South Florida, California reflect the condition in their median prices for houses.

When compared to the fourth quarter of 2006, all the four regions has shown drop in prices

West            8.7 %

Northeast      4.8 %

South           5.4 %

Midwest        3.2 %

Some of the places shown bigger drop in prices than their area average

Lansing, Michigan square in the Midwest Rust Belt                    18.8% to $109,600

Sacramento, California                                               18.5% to $197,600

Jackson, Miss and Riverside, California                          16.8%.

At the same time prices in the least expensive market has further gone down. Prices of single-family-home in Youngstown, Ohio dropped to $72,6000, which is a 9.3% plunge from the previous price.

Condo prices have also shown sign of drop in various markets

Cape Coral, Florida,   26% to $202,300

Tucson, Arizona        19.8% to $128,000

Atlanta                             12% to $141,100

Las Vegas               10.3% to $178,500