Home-Price Declines Biggest on Record

Atlanta and Dallas finally entered negative territory, with declines of 0.7% and 0.1%, respectively.

In Atlanta, at least, some didn't see the declines as such a bad thing.

"The Atlanta market is correcting itself," says builder Mike Baptist, president of Haven Properties, Atlanta. "We're absorbing some inventory right now. Housing starts are down because we've learned to be more prudent before we put anything in the ground. That doesn't mean we're not alive and well. It's a great time to buy a home in Atlanta."

"I cannot tell that prices are down that much, but sales volume is down," adds builder Kenny King, president of the Hearthstone Group in Lawrenceville, Ga. He also points out that housing starts are down, and that's "a good thing," he says. "It will help the supply/demand equation [for] pricing."

Six of the metro areas are now posting double-digit declines in their annual growth rates, according to the Case-Shiller data. Miami surpassed Tampa in October, reporting a double-digit annual decline of 12.4%. Tampa followed with -11.8%, Detroit with -11.2%, San Diego with -11.1% and lastly, Las Vegas with -10.7%.

Some people say it's even worse than the survey data indicate.

"Forget the Case-Schiller numbers -- they do not reflect the real market conditions," says Steve Hochman, author of How To Sell Your Real Estate When Real Estate is Not Selling. Hochman brokers deals through his company, Friendly Note Buyers, which has offices in New York, Delaware and London and helps owner-financing sellers construct the best deals. "Tampa, Fla., prices are down by 40%, Las Vegas are down by at least 50%," he says. "In some markets, we are being offered [real-estate-owned] debt at 15 cents on the dollar, and even so, I have no takers."

Jay Dacey, a mortgage planner in Plymouth, Minn., agrees that actual price declines are far greater than the data indicate.

"There are some great opportunities on individual properties right now that have a larger discount than what the macro reports are showing. These sellers have factored in the 'worst case' in their price," he says. "First-time buyers and savvy investors will build long-term wealth if they buy and hold at these prices with today's available financing. Potential buyers, especially those with a long-term view, should be getting prequalified right now with a mortgage professional."