R.I. among top 5 states for biggest peak-to-current HPI drop in May

RHODE ISLAND was among the five states in May with the largest gap between current home prices and the statewide peak in prices, which occurred in October 2006.  / COURTESY CORELOGIC
RHODE ISLAND was among the five states in May with the largest gap between current home prices and the statewide peak in prices, which occurred in October 2006. / COURTESY CORELOGIC

PROVIDENCE – At 27.5 percent, Rhode Island was among the five states in May that have the largest gap in home prices from the peak prices years earlier.

The Ocean State’s peak home price was reached in October 2006, according to data released Tuesday by CoreLogic.

Nevada had the greatest peak-to-current decline at 32.9 percent, followed by Florida at 28.8 percent, and Rhode Island at 27.5 percent. Rounding out the top five were Arizona at 26 percent and Maryland at 23.1 percent. The prices include distressed sales.

Year over year, home prices in Rhode Island increased 2.6 percent, including distressed sales, which are real estate-owned or short sales. Excluding distressed sales, home prices climbed 2.7 percent.
The gain was not as high in the Providence-Warwick metropolitan area, which reported a 2 percent year-over-year increase in home prices in May when distressed sales are included, and a 2.4 percent increase when they are excluded.

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Nationwide, home prices rose 6.3 percent year over year in May, including distressed sales. This change represents 39 consecutive months of year-over-year increases in home prices nationally, CoreLogic said.
Including distressed sales, five states experienced home price depreciation on a year-over-year basis: Massachusetts, -4.8 percent; Connecticut, -1.8 percent; Maryland, -1.5 percent; Mississippi, -1.4 percent; and Louisiana, -0.8 percent.
When distressed sales are excluded, only Massachusetts and Louisiana showed year-over-year price depreciation in May at -2 percent and -0.2 percent, respectively.

Including distressed sales, South Carolina and Colorado had the highest home price appreciation at 10.3 percent and 9.8 percent, respectively, and also held the top two spots when they are excluded, with 9.6 percent and 9.2 percent gains.
CoreLogic said home prices, including distressed sales, are expected to increase 5.1 percent year over year from May 2015 to May 2016. Excluding distressed sales, home prices are projected to increase 4.7 percent from May 2015 to May 2016.
“Mortgage rates on 30-year fixed-rate loans remained below 4 percent through May, helping to fuel home-purchase activity,” Frank Nothaft, chief economist for CoreLogic, said in a statement. “Our homes-for-sale listing data shows that markets with high demand and limited supply, such as San Francisco, are recording double-digit appreciation rates over the past year.”
Anand Nallathambi, president and CEO of CoreLogic, said the rate of home price appreciation increased in May with gains “fairly widely distributed across the country.” Higher home prices have spurred increases in new single-family home construction, Nallathambi said.
“Sales of newly built homes during the first five months of 2015 were up 23 percent from a year ago, and as rising values build equity for homeowners, we expect to see more existing homes offered for sale in the coming year,” Nallathambi said.

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