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Home Prices Fall Further, But Sales Start to Rise

The value of existing U.S. single-family homes in metropolitan areas fell 7.6 percent in the second quarter from a year ago, with homes in the West tumbling 17.4 percent, the National Association of Realtors said.

Still, sales rose in some areas as buyers responded to the continued decline in prices, the group said.

AP

Earlier Thursday, RealtyTrac said the number of homeowners stung by the dramatic decline in the U.S. housing market jumped last month as foreclosure filings grew by more than 50 percent compared with the same month a year ago, according to data released Thursday.

Home prices fell in 115 of 150 metropolitan areas with several California cities seeing deep, double-digit drops in prices, the NAR said.

A metro region including parts of Los Angeles and Long Beach saw home price declines of 29.5 percent while Riverside-San Bernadino measured a 32.7 percent drop from the year-ago quarter.

Several Florida regions that saw big price gains during the recent housing boom have fallen sharply with the Gulf Coast city of Ft. Myers clocking a 33.1 percent drop in values.

Tampa-St. Petersburg saw prices decline 18.8 percent in the second quarter.

The trade association said that about one-third of home transactions are distress sales that either take place through foreclosure or "short sales" where the holder of the mortgage agrees to take a loss.

NAR President Richard Gaylord, a broker with RE/MAX Real Estate Specialists in Long Beach, Calif., said foreclosures are distorting the price data.

"In many areas with large concentrations of foreclosure sales, homes are being purchased below replacement cost values," Gaylord said. "Many buyers with long-term expectations are getting exceptional value in the current market."

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  • Diana Olick serves as CNBC's real estate correspondent as well as the editor of the Realty Check section on CNBC.com.