Link to release

The Office of Federal Housing Oversight released a report today on overall price declines for the 1st quarter of 2008.  Generally, the OFHEO HPI is slower to react than the Case-Shiller index in part due to the way OFHEO uses same property sales and refinances to determine it’s index, but also due to the somewhat limited market segment serviced by Fannie Mae and Freddie Mac.  Fannie and Freddie are huge, so there is a large base of loans, but those loans are mostly “plain vanilla” with large jumbo loans and subprime excluded.

It’s worth a read just to understand how prices are moving in different areas of the country, noticing how the doom and gloom reported in hard hit states like California, Nevada and Florida doesn’t reflect actual conditions in many parts of the country.  Take special note of the year over year declines in the California cities of Merced (-24.7%), Stockton (-21.5%), and Modesto (-21.0%).  Those are huge percentages that will certainly impact averages, but although I’ve been to all three places, I’ve never known anyone who has owned property there.  Significant impact for the people living in that area, but not so significant for people living in other places.