MCLEAN, Va., Dec. 5 (UPI) -- Third-quarter U.S. home prices fell 1.3 percent, following a 0.5 percent drop in the second quarter, for the largest decline in 25 years, Freddie Mac said Tuesday.
Prices edged up 1.9 percent from the third quarter a year earlier, but the increase compared with a 7.8 percent year-to-year growth the government-sponsored mortgage funding company reported for the 2005-2006 third-quarter comparison.
"Lenders have tightened underwriting standards, and the turbulence in the capital markets led to a spike in the cost of jumbo loans, further adding to the challenge of buying homes," Freddie Mac Chief Economist Frank Nothaft said.
The inventory of existing single-family homes for sale rose to 10.5 months supply by October, the highest level since 1985, Nothaft added.
Freddie Mac, formally known as the Federal Home Loan Mortgage Corp., said its Pacific region -- including California, Oregon, Washington, Alaska and Hawaii -- posted the fastest rate of depreciation, at 3.5 percent.
