Another month of price declines

Weak demand continued to depress housing prices in October, according to CoreLogic, the real estate information provider.

Home prices nationally fell 1.3 percent from September, the third consecutive monthly decline. They had fallen 3.8 percent in September from August, and were 3.9 percent below October 2010.

By comparison, Philadelphia prices rose 0.7 percent from October 2010 to the same month in 2011. If the distressed-home sales were removed from the picture, Philadelphia area prices would have risen 1.6 percent.

If those sales were removed from the national calculations, the national year-over-year drop would have been 0.5 percent.

Including distressed transactions, the peak-to-current change in CoreLogic's national home price index from April 2006 to October 2011 was minus 32.0 percent. Excluding distressed transactions, it was minus 22.4 percent.

"Our forecasts indicate flat growth through 2013," said Mark Fleming, CoreLogic's chief economist.

Builders, too, are having growth problems, and a recent poll by the National Association of Home Builders blames commercial banks, which continued in this year's third quarter "to hold tight reins on acquisition, development and construction loans."

More than half of the single-family builders and developers surveyed by the association indicated they had decided to put any new construction or land activity on hold until the financing climate improves.

According to the survey, 77 percent said lenders were reducing the amount they were willing to lend; 75 percent reported seeing the allowable loan-to-value ratio being lowered; 66 percent found lenders who were not making any new real estate loans, and 63 percent said they encountered lenders who were requiring personal guarantees or collateral not related to the project.

Lenders most often told builders they were tightening on loans because the regulators were forcing them to do so.