By J.W. ELPHINSTONE -- AP Real Estate Writer

NEW YORK (AP) — Home prices tumbled by the worst annual rate on record in the fourth quarter, two housing indexes showed Tuesday, and the slope of decline steepened in all but a handful of battered cities.

The farther prices fall, the fewer homeowners may be able to qualify for President Barack Obama's mortgage relief plan. Last week, the president estimated up to 5 million borrowers in good standing who don't owe more than 105 percent of their home's current value would be able to refinance into a lower interest-rate loan.

Though details of the plan won't be released until March 4, almost 14 million homeowners are already under water, according to Moody's, meaning they owe more on their mortgages than their homes are worth. Nationally, home prices have receded to 2003-levels, and half of the metro areas in the 20-city Case-Shiller Home Price Index have lost more than 20 percent of their values from their peaks in 2006, including Las Vegas, Phoenix and Miami.

"If they don't get (the plan) into place very soon, it will be out of our reach to help these people," said Mark Zandi, chief economist for Moody's

Americans are feeling grim about the prospects of any turnaround. Consumer confidence index sank to new lows in February as widespread layoffs, shrinking retirement accounts and plunging home prices fueled fears, the Conference Board said Tuesday.

The Standard & Poor's/Case-Shiller U.S. National Home Price Index plunged more than 18 percent during the quarter from the prior-year period, the largest drop in its 21-year history.

Meanwhile, the Federal Housing Finance Agency said Tuesday that home prices dropped more than 8 percent in the quarter from a year earlier, its largest annual decline on record since 1991.

The reports, however, did offer a modicum of good news. The rate of year-over-year price declines slowed in Boston, Denver, Los Angeles, San Diego and Washington, according to the Case-Shiller index, while cities in Washington, North Dakota and Texas posted year-over-year quarterly gains, the government said.

Home prices in the Boston suburbs are holding up better than in the city itself, said Judy Moore, a broker with Re/Max Landmark Realtors in Lexington, Mass.

Buyers are encouraged by the combination of low interest rates and the $8,000 first-time homebuyer tax credit tucked in the latest stimulus plan.

"I've seen more buyers out there kicking the tires," Moore said.

But prices in the Sun Belt cities continue to get clobbered. Phoenix, Las Vegas and San Francisco all saw home values lose more than 30 percent in December, the Case-Shiller index said. And the government index showed many California and Florida cities clocked their worst declines in the fourth quarter.

In Miami, buyers can't get financing for condos in buildings that have more than 30 percent investor-owned units, or if more than 15 percent of owners are behind on their common fees.

That's bringing down prices in those buildings by as much as 25 percent, said Ron Shuffield, president of Esslinger-Wooten-Maxwell Realtors. "It's more of a credit problem now than a real estate problem because the values are down," he said.

Prices in the Case-Shiller 20-city index have plunged 27 percent from their peak in the summer of 2006, and the 10-city index has fallen more than 28 percent. Both indices have recorded year-over-year declines for 24 straight months.

On Wednesday, the National Association of Realtors releases its existing home sales data for January and the Commerce Department releases its new home sales figures for January on Thursday.

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